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The Commonwealth of Australia arose in 1901 through the federation of six British colonies, each with its own pattern of services. Traditionally, health services, including mental health services, have been the responsibility of what became the State Governments. Child and adolescent mental health services began in the 1920s in the paediatric hospitals of major cities, and with a small number of Child Guidance Clinics operated by State Health Departments, following the example of the USA. The mental health needs of the young have also been addressed by a vibrant non-government sector providing health, welfare and support services to children, adolescents and families.

In 1993, the States agreed to collaborate with the Commonwealth Government in the first five-year National Mental Health Plan. The Plan aimed to abolish all stand-alone mental hospitals, bringing mental health services under the management of general hospitals, with the same quality of care as provided to general health patients. This would provide community-based support and rehabilitation for those with chronic illness to greatly increase the involvement of Consumers and Carers in the service system. Subsequent extensions of the Plan have emphasised health promotion, illness prevention, and collaboration with other health care providers. This has resulted in improvements in the general standard of psychiatric care, although significant shortcomings still exist. In particular, there is still major under-resourcing of child and family services throughout the nation.

Child and family psychiatry has been actively included in the training of all psychiatrists from the late 1940's through the Australasian Association of Psychiatrists, later to become the Royal Australian and New Zealand College of Psychiatrists (RANZCP). When the College was founded, there was a specific Section of Child Psychiatry with its own training program for specialists in this field. This later became the first specialist Faculty of the College. Although Faculty members constitute only about 10% of the total membership of the College, they make a very large contribution to the professional and socio-political work of the College. Dr Julian Katz was appointed as the first Professor of Child Psychiatry in Australia in 1963, at Sydney's Royal Alexandra Hospital for Children and the University of Sydney. Since then, academic positions in child psychiatry have been developed in most other States, and university Departments of Psychiatry or Psychological Medicine have collaborated with the RANZCP in undergraduate and postgraduate training and in many areas of research in mental health. A collaborative multidisciplinary approach has been a central feature of child and adolescent mental health services in Australia from the outset. Psychology, social work, nursing, occupational therapy, speech pathology and special education have all played significant roles. Graduates of many disciplines are involved in mental health work, and most professional associations of these disciplines have special interest groups involving child, adolescent and family practice and research. The Australian Psychological Society College of Clinical Psychologists, in particular, sets and enforces clear and detailed training standards for postgraduate university training programs in this specialised area.

Specialised professional organisations relating to child and adolescent mental health are well developed, notably the Australian Association of Infant Mental Health (AAMHI), the Australian and New Zealand Association of Family Therapists, and the Psychoanalytic Psychotherapists Association of Australasia. In addition to academic and specific professional organizations, there are other associations that play an important role in Australia's mental health system which includes Consumers and members of the public. The Mental Health Foundation, AICAFMHA (Infant, Child, Adolescent and Family Mental Health Association), "Sane" and Autism Australia are central among many such contributors.