In the space of thirty years the circumstances of Australian nationhood changed irrevocably. The country's strategic dependence on Britain drew it into two wars. Both originated in European rivalry and together they exhausted European supremacy. The first sapped the political stability of the combatants and cut the flows of trade and investment that sustained their prosperity. The second destroyed their empires, leaving an impoverished rump of a continent divided and bound by the two super-powers to its east and west. Britain, a victor in both wars, was perhaps the most diminished by their cumulative effects. Australia, as the largest British outpost in the Pacific, also incurred heavy war losses. The fading of imperial certainties created doubt and division. The nation-building project faltered under the weight of debt and increased dependence. Only as the second war spread to the Pacific, and Australia found itself isolated and in danger of invasion, came a belated recognition of the need to reconstruct the nation for changed circumstances.

The first of these wars was known by those who survived it as the Great War; they had never experienced such a catastrophe and could not imagine that another would follow so soon. After the conclusion of the Napoleonic Wars in 1815 Europe enjoyed a century of peace – although Europeans waged repeated wars of colonial conquest, at home there were only occasional and limited conflicts that were quickly settled by a decisive encounter of professional armies.