Australia's meteorology bureau has found that 2005 was the country's hottest year on record, prompting renewed fears of global warming.
New Year's Day in Sydney was also the hottest on record
The average temperature was 22.89 C - a rise of more than 1 C from the average in previous years and the highest since records began in 1910.
Environment Minister Ian Campbell admitted the change was "alarming".
But he defended Australia's decision not to sign the Kyoto pledge to cut greenhouse gases.
The annual mean temperature in 2005 was 1.09 C (1.96 degrees Fahrenheit) higher than the average between 1961 and 1990, according to data released on Wednesday by the Bureau of Meteorology.
"While these temperature departures may seem relatively small, a 1C increase in mean temperatures is equivalent to many southern Australian towns shifting northward by about 100 km (60 miles)," the bureau said in its annual climate summary.
Temperatures in northern Australia are usually warmer than in the south.
Environment Minister Ian Campbell said climate change was the world's "number one environmental challenge".
"These figures add to the weight of evidence that climate change is real, and it's a problem that the world needs to work together to seek to solve," Mr Campbell told ABC News.
But he defended the government's decision not to sign the Kyoto Protocol - saying it was inadequate because it failed to include developing countries.
"We need something that includes all countries," he said.
Australia and the US are the only two major industrialised nations to refuse to join the agreement, which calls for a reduction in greenhouse gas emissions by 2012.
Wednesday's research comes as Sydney prepares to host the inaugural meeting of the Asia-Pacific Clean Development and Climate Partnership on 11-12 January.