Extraordinary powers of imagination, a love of mystery and a preoccupation with heroism and death, along with a precocious philosophical seriousness, were apparent early in the character of Alfred Deakin. His parents were English migrants, nominally Church of England members and tolerant in their attitudes, devoted to Alfred and his older sister Catherine, who practised considerable self-denial to give their talented children a good education. William Deakin came from Northamptonshire where he had been a commercial traveller, and Sarah Bill was the daughter of a Shropshire farmer In 1849 they married and emigrated to Australia where, with help from relatives, William first became a partner in a mail run from Serpentine to Swan Hill; then, moving to Melbourne, he was accountant to Cobb & Co. for the rest of his working life.

In a handwritten note self-effacingly entitled ‘Parents of Alfred Deakin’, Catherine describes the characters and the middle-class values of these ‘refined, simple people with a strong thrall of duty’. They were ‘broadminded and unconventional’, yet also ‘great believers in good manners and the customs of well-bred English folk’. They were ‘lovers of home and children’. William was impressionable, enthusiastic and talkative, with great powers of description and a fondness for literature, especially for the English classics which he would read aloud to the family.