History of Sydney
With the inauguration of the Commonwealth of Australia on 1 January 1901, Sydney ceased to be a colonial capital and became the capital of the Australian state of New South Wales. With industrialisation, Sydney expanded rapidly, and by the early 20th century it had a population well in excess of one million.
History of Australia (1851–1900)
In 1858 a new gold rush began in the far north, which led in 1859 to the separation of Queensland as a new colony. New South Wales thus attained its present borders, although what is now the Northern Territory remained part of the colony until 1863, when it was handed over to South Australia. The separation and rapid growth of Victoria and Queensland mark the real beginning of New South Wales as a political and economic entity distinct from the other Australian colonies. Rivalry between New South Wales and Victoria was intense throughout the second half of the 19th century, and the two colonies developed in different directions. Once the easy gold ran out by about 1860, Victoria absorbed the surplus labour force from the gold fields in manufacturing, protected by high tariff walls. Victoria became the Australian stronghold of protectionism, liberalism and radicalism. New South Wales, which was less radically affected demographically by the gold rushes, remained more conservative, still dominated politically by the squatter class and its allies in the Sydney business community. New South Wales, as a trading and exporting colony, remained wedded to free trade.