The 300-strong Australian Paralympics team will use Wales as a training base in the run up to the London 2012 games.
Greg Hartung, president of the Australian Paralympic Committee, has signed an agreement confirming the squad will prepare in Wales.
The Welsh Assembly Government confirmed the move, and First Minister Rhodri Morgan said it underlined the quality of Wales' facilities.
The Australian Paralympics team won 79 medals at the games in Beijing.
Officials said it was too early to say where in Wales the Australian team would be based, but the national pool in Swansea and the velodrome in Newport could feature strongly in the build-up.
"It just goes to show our facilities are on a par, if not better, than the rest of the facilities in the UK"
Rhodri Morgan said: "The fact that Australia, one of the great sports-obsessed nations of the world, has chosen Wales to base more than 300 athletes in the build up to the 2012 games underlines the quality and accessibility of the training facilities we have here.
"The success achieved by Welsh athletes at this year's Olympics and Paralympics has already shown that we have world-beating facilities and coaches.
"This obviously hasn't escaped the notice of Australia's sporting chiefs who want to take advantage of our wonderful facilities and support for athletes in the run-up to the 2012 Paralympics."
Mr Morgan said the would "try and close similar agreements with other Olympic and Paralympic delegations who need to acclimatise ready for London".
Wales' own Paralympians returned to a special welcome in Cardiff Bay this week with a haul of 10 gold, three silver and one bronze medal won in Beijing.
Nathan Stephens, from Bridgend, who competed in the shot, javelin and discus in Beijing, said Wales had excellent facilities.
"I'm sort of surprised, but I'm glad we (Wales) got it," he said, on hearing the Australian choice.
"It just goes to show our facilities are on a par, if not better, than the rest of the facilities in the UK," he added.
"We have a number of great training bases. I've been using the National Indoor Training Centre in Cardiff for seven years, and up the road are new facilities at Leckwith.
"In Swansea, there's the national pool and there's an athletics track right outside."
Heritage Minister Alun Ffred Jones said: "The decision by the Australian team to come to Wales means that other countries will see us as a serious option to locate their training camps in our country and we'll continue to work hard to attract those other teams here."
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