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Australia Day commemorates the arrival of the First Fleet at Sydney Cove in New South Wales on 26 January 1788. This was a significant date because it marked the beginning of European settlement in and colonisation of Australia.

As well as the arrival of the British Admiralty's First Fleet to Port Jackson, Australia Day celebrates the unfurling of the British flag at Sydney Cove, and the proclamation of British sovereignty, under King George III of Great Britain, over the eastern Australian seaboard including, for the first time, Van Diemen's land (later called Tasmania). Lieutenant James Cook had explored most of the eastern coast in 1770. The three events made concrete the subsequent British intentions and plans for permanent settlement of the continent.

Many Australians do not actually realise the significance of Australia Day, having misconceptions about why we have Australia Day (such as thinking it is when James Cook first landed on Australia's shores). Many Australians are just happy to have a day off work.

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