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Cyclone Tracy began as a tropical storm out in the Arafura Sea. It developed into a category 4 cyclone as it moved towards Australia's northern coast. On Christmas Day, 25 December 1974, Tracy made landfall and left Darwin in shreds. The cyclone passed directly over Darwin just after midnight, with its 'eye' centred on the airport and northern suburbs. The wind gauge at Darwin Airport officially recorded winds of 217 kilometres per hour before being blown away itself. Unofficial estimates suggest that the wind speed actually reached 300 kilometres per hour, making it possibly a category 5 when it made landfall. Its destruction was so great because Darwin was a bit of a ramshackle town, with many building codes not adhered to during its "boom" time, post-war. Quite simply, the buildings were not made to withstand cyclones, despite being within the cyclone belt.

Officially, 71 people were killed, and 9,000 homes destroyed, out of a city of 43,500 people living in 12,000 residences. However, unofficial estimates are much higher as these figures do not include the local indigenous populations or drifters and homeless in Darwin at that time. There were 22 vessels at sea when the cyclone struck, and of those aboard, 16 were never found.

Most of Darwin's residents were evacuated following the devastation, and many of them never returned.

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