Melburnians danced, barbecued, paraded and protested through Australia Day, in backyards, on the beach and in the streets. In the city, revellers had the choice of four official events, including the annual parade from Swanston Street to St Kilda Road. 
Australia Day Victoria Committee chair Stefan Romaniw said about 12,000 people watched the parade and about 7000 watched the flag-raising ceremony at the Melbourne Town Hall.
"It was a very colourful and exciting parade,' Mr Romaniw said. "It showed our uniqueness and diversity."
He said about 90,000 people came to the picnic and Federation vehicle display at Kings Domain Gardens, and 25,000 were expected to watch two tonnes of fireworks explode at Docklands.
Thai students Billy Sutthajit and Pang Nuuvathai said they had started the day watching the parade and were planning to have a picnic in the Royal Botanic Gardens.
It was Bella McDonald's first Australia Day. The nine-month-old was out with dad Matt McDonald, mum, Kara Pattison, and sister, two-year-old Ava McDonald.
"We are just enjoying dad being home for the day, just being with the family," Ms Pattison said. "We are enjoying our city."
Edinburgh Gardens, the scene of mayhem in the past, hosted a crowd of more than 3000 people marking the day.
City of Yarra mayor Roberto Colanzi thanked everyone who contributed to the safe and respectful use of the "magnificent" park.
City of Port Phillip mayor Bernadene Voss said an estimated 50,000 people gathered at the St Kilda foreshore and remained "very well behaved" throughout the day.
It was a different kind of celebration at Treasury Gardens which was hosting its 14th Share the Spirit festival to mark "Survival Day" of Australia's Indigenous community.
Families with babies in prams, elderly couples, youngsters wearing Aboriginal flag T-shirts, as well as tourists spread picnic blankets and listened to 50 artists perform. Share the Spirit committee member Kevin Garant said about 5000 people come to the event.
"It is definitely an increase from last year," Mr Garant said.
"It's really opened up," he said. "I find it really interesting that different cultures find this is a great way to spend Australia Day."
Earlier, hundreds of people had rallied at Spring Street to protest against Australia Day celebrations.
Palawa woman Jody Beeton who had been at the rally said it was "absolutely sick" to celebrate Australia Day. "We are just celebrating death and genocide," she said
She said Australia Day was about the survival of the Indigenous community.
"We are still here, they have stolen generations, massacred right through this land, [our] sacred sites have been taken away," Ms Beeton said.
"We survived in extraordinary conditions."