Australia is a federation, made up of six states and two territories. The states are New South Wales, Victoria, Queensland, South Australia, Western Australia, and Tasmania. The two territories are the Northern Territory, and Australian Capital Territory, which is the area surrounding the capital city of Canberra.

Australia uses a two-tier parlimentary system of government that has been based on what is used in the United Kingdom. The federal parliament is comprised of the lower house, the House of Representatives, and the upper house, the Senate. Each state has it's own parliament. The federal government oversees the Reserve Bank and the national economy, immigration, customs and excise, foreign policy, defense, and the postal system. The state parliaments are responsible for health, education, tranport, housing and justice. There are both state and federal police forces.

Australia is a monarchy under the British Queen, but is fully autonomous. The sovereign is represented by a Governor General.