Australia, officially the Commonwealth of Australia, is a country in the southern hemisphere comprising the mainland, which is both the world's smallest continent and the world's largest island, the island of Tasmania, and numerous other islands in the Indian and Pacific Oceans. It is the only area of land simultaneously considered a continent, a country and an island. Neighbouring countries include Indonesia, East Timor and Papua New Guinea to the north, the Solomon Islands, Vanuatu and New Caledonia to the north-east and New Zealand to the southeast.

For around 40,000 years before European settlement commenced in the late 18th century, the Australian mainland and Tasmania were inhabited by around 250 individual nations of indigenous Australians. After sporadic visits by fishermen from the immediate north, and European discovery by Dutch explorers in 1606, the eastern half of Australia was claimed by the British in 1770 and initially settled through penal transportation to the colony of New South Wales, founded on 26 January 1788. The population grew steadily in the following years; the continent was explored, and during the 19th century another five largely self-governing Crown Colonies were established.

On 1 January 1901, the six colonies became a federation, and the Commonwealth of Australia was formed. Since Federation, Australia has maintained a stable liberal democratic political system and remains a Commonwealth realm. The population is just over 21.7 million, with approximately 60% concentrated in and around the mainland state capitals of Sydney, Melbourne, Brisbane, Perth, and Adelaide. The nation's capital city is Canberra, located in the Australian Capital Territory (ACT).

Technologically advanced and industrialised, Australia is a prosperous multicultural country and has excellent results in many international comparisons of national performance such as health care, life expectancy, quality-of-life, human development, public education, economic freedom, and the protection of civil liberties and political rights. Australian cities also routinely rank among the world's highest in terms of livability, cultural offerings, and quality of life. It is a member of the United Nations, G-20 major economies, Commonwealth of Nations, ANZUS, OECD, and the WTO.

Human habitation of Australia is estimated to have begun between 42,000 and 48,000 years ago. These first Australians may have been ancestors of modern Indigenous Australians; they may have arrived via land bridges and short sea-crossings from what is now South-East Asia. Most of these people were hunter-gatherers, with a complex oral culture and spiritual values based on reverence for the land and a belief in the Dreamtime. The Torres Strait Islanders, ethnically Melanesian, were originally horticulturalists and hunter-gatherers. Their cultural practices have always been distinct from those of the mainland Aborigines.

The first recorded European sighting of the Australian mainland was made by the Dutch navigator Willem Janszoon, who sighted the coast of Cape York Peninsula in 1606. During the 17th century, the Dutch charted the whole of the western and northern coastlines of what they called New Holland, but they made no attempt at settlement. In 1770, James Cook sailed along and mapped the east coast of Australia, which he named New South Wales and claimed for Great Britain.

Cook's discoveries prepared the way for establishment of a new penal colony. The British Crown Colony of New South Wales began a settlement at Port Jackson by Captain Arthur Phillip on 26 January 1788. This date was later to become Australia's national day, Australia Day. Van Diemen's Land, now known as Tasmania, was settled in 1803 and became a separate colony in 1825. The United Kingdom formally claimed the western part of Australia in 1829. Separate colonies were created from parts of New South Wales: South Australia in 1836, Victoria in 1851, and Queensland in 1859. The Northern Territory was founded in 1911 when it was excised from South Australia. South Australia was founded as a "free province"—that is, it was never a penal colony. Victoria and Western Australia were also founded "free" but later accepted transported convicts. The transportation of convicts to the colony of New South Wales ceased in 1848 after a campaign by the settlers.

The Indigenous Australian population, estimated at 350,000 at the time of European settlement, declined steeply for 150 years following settlement, mainly because of infectious disease. The "Stolen Generation" (removal of Aboriginal children from their families), which historians such as Henry Reynolds have argued could be considered genocide by some definitions, may have contributed to the decline in the indigenous population.

Such interpretations of Aboriginal history are disputed by some conservative commentators, such as former Prime Minister Howard, as being exaggerated or fabricated for political or ideological reasons. Historian Keith Windschuttle has argued that the dominant historical interpretation of the treatment of Aboriginal people on the frontiers of white settlement in Australia amounts to a fabrication. He claims this is the result of work done by a generation of politically inspired academics. That work, he charges, is characterised by poor historical method and by lack of evidence, and they have invented stories, made up figures, suppressed evidence, falsely referenced sources and deceived their readers.

This debate is known within Australia as the History Wars. Following the 1967 referendum, the Federal government gained the power to implement policies and make laws with respect to Aborigines. Traditional ownership of land—native title—was not recognised until 1992, when the High Court case Mabo v Queensland (No 2) overturned the notion of Australia as terra nullius (literally "no one's land," effectively "empty land") at the time of European occupation.

A gold rush began in Australia in the early 1850s, and the Eureka Stockade rebellion against mining licence fees in 1854 was an early expression of civil disobedience. Between 1855 and 1890, the six colonies individually gained responsible government, managing most of their own affairs while remaining part of the British Empire. The Colonial Office in London retained control of some matters, notably foreign affairs, defence, and international shipping. On 1 January 1901, federation of the colonies was achieved after a decade of planning, consultation, and voting. The Commonwealth of Australia was born and it became a dominion of the British Empire in 1907. The Federal Capital Territory (later renamed the Australian Capital Territory) was formed from a part of New South Wales in 1911 to provide a location for the proposed new federal capital of Canberra. (Melbourne was the temporary seat of government from 1901 to 1927 while Canberra was being constructed.) The Northern Territory was transferred from the control of the South Australian government to the Commonwealth in 1911.

In 1914 Australia joined Britain in fighting World War I, with support from both the outgoing Liberal Party and the incoming Labor Party. The Australians took part in many of the major battles fought on the Western Front. Many Australians regard the defeat of the Australian and New Zealand Army Corps (ANZACs) at Gallipoli as the birth of the nation—its first major military action. The Kokoda Track Campaign is regarded by many as an analogous nation-defining event during World War II.

Britain's Statute of Westminster 1931 formally ended most of the constitutional links between Australia and the UK. Australia adopted it in 1942, but backdated it to the beginning of World War II to confirm the validity of legislation passed by the Australian Parliament during the war. The shock of the UK's defeat in Asia in 1942 and the threat of Japanese invasion caused Australia to turn to the United States as a new ally and protector. Since 1951, Australia has been a formal military ally of the US, under the ANZUS treaty. After World War II, Australia encouraged immigration from Europe; since the 1970s and the abolition of the White Australia policy, immigration from Asia and elsewhere was also encouraged. As a result, Australia's demography, culture, and self-image have been transformed. The final constitutional ties between Australia and the UK were severed with the passing of the Australia Act 1986, ending any British role in the government of the Australian States, and ending judicial appeals to the UK Privy Council. At the 1999 referendum, 54% of Australian voters rejected a proposal to become a republic with a president appointed by two-thirds vote of both houses of the Australian Parliament. Since the election of the Whitlam Government in 1972, there has been an increasing focus on the expansion of ties with other Pacific Rim nations while maintaining close ties with Australia's traditional allies and trading partners.