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This paper traces the development of database production and the online industry in Australia and focuses on recent trends in online and CD‐ROM use, problems related to the further development of the industry and future prospects. Issues related to the development of Australian online services and individual databases are described in the Proceedings of the Australian Online Conference (Library Association of Australia 1986) (The Information Science Section of the Australian Library and Information Association, formerly the Library Association of Australia, has held five Information Online conferences in Sydney, the most recent being ‘Information Online and On Disc 91’ in January 1991), seminar publications of the Australian Database Development Association (ADDA) (Australian Database Development Association 1990; Quinn 1987) and the Australian Library and Information Science's encyclopaedia (Bryan 1988). Further developments are reported through local newsletters such as the ADDA Newsletter and Online Currents. The following discussion draws from these as well as from responses to a survey of database vendors and CD‐ROM publishers in Australia (Table 1 (overleaf) lists those contacted). Twenty‐five of the 34 service providers contacted responded to the survey. Five overseas database hosts with no local representatives did not reply.