Sydney may not be the capital (that’s Canberra), but it is the glitzy party-loving heart of modern Australia and the country’s biggest metropolis with a population of just over four million. Its unique setting, with miles of coastline, a breathtaking harbour and mountainous parklands is complemented by a warm tropical climate.

The city was inhabited for tens of thousands of years by Aboriginal bands. The traditional owners of the Sydney City Region were (and for many still are) the Cadigal band, but the arrival of English explorer Captain James Cook in 1770 changed all that. In 1788 Governor Arthur Phillip settled on Sydney Cove as a colony for British convicts and a trading port on the East India route. Aborigines were dispossessed of their land and those who didn’t flee to the bush were either killed, put in reserves or died from European diseases. Today Sydney’s population reflects the nation’s changing immigration policies which initially aggressively canvassed 'whites only', and have since accepted the country’s place on the Pacific Rim with citizens originating from over 180 nations.

The crenellated harbour is the spine of the city, and a good way to get an idea of its layout and a ringside view of some of the city’s most extravagant residences is on a harbour cruise, on one of Sydney’s famous green and gold ferries (+61292411281) from Wharves 4 and 5 at Circular Quay. Also here are Sydney’s two most famous icons, the Sydney Harbour Bridge connecting the CBD with the north shore, and the great sails of the Sydney Opera House (Bennelong Point, +61292507111). If vertigo isn’t a problem try climbing the bridge with BridgeClimb (5 Cumberland Street, the Rocks, +61292401100): the views from the top are amazing. Sydney’s third icon – Bondi Beach – is east of the city and best reached by bus (No.380 from Circular Quay).

The city centre is compact and flanked by two verdant parks – the harbourside Royal Botanic Gardens (Mrs Macquarie’s Road,+61292318111) and Hyde Park where fruit bats hang from the trees. Other sites worth taking in include the perfectly ordered Chinese Garden (Darling Harbour, +61292816863) and the Museum of Sydney (corner of Bridge&Phillip Streets, CBD, +61292515988), which has exhibits tracing Aboriginal and settler history.

Sydney is by no means short of a festival or two either. The city is over-run at New Year (www.sydneynewyearseve.com.au) with visitors coming to see its spectacular firework displays over the harbour and in February/March when the Gay&Lesbian Mardi Gras Festival (www.mardigras.org.au) takes over, culminating in a huge street parade.