Australia Australia is the world's smallest continent and sixth-largest country. With proportionately more desert land than any other continent, Australia has a low population density. Lying completely in the Southern Hemisphere, Australia is bounded by the Indian Ocean on the west and south and by the Pacific Ocean on the east. These oceans merge on the north in the Arafura Sea between Australia and Indonesia and New Guinea, and on the south in the Bass Strait. The coastline length, estimated at 19,200 km (12,000 mi), is remarkably short for so large an area, a result of the relative lack of indentation.