In 1788, the eleven ships of the First Fleet landed their 'cargo' of around 780 British convicts at Botany Bay in New South Wales. Two more convict fleets arrived in 1790 and 1791, and the first free settlers arrived in 1793.

From 1788 to 1823, the Colony of New South Wales was officially a penal colony comprising mainly convicts, marines and the wives of the marines.

The early convicts were all sent to Botany Bay, but by the early 1800s they were also being sent directly to destinations such as Norfolk Island, Van Diemen's Land, Port Macquarie and Moreton Bay.

Twenty per cent of these first convicts were women. The majority of women convicts, and many free women seeking employment, were sent to the 'female factories' as unassigned women. The female factories were originally profit-making textile factories. The Parramatta Factory grew as an enclave for pregnant women and also served as an orphanage from the 1830s.

Governor Philip (1788-1792) founded a system of labour in which people, whatever their crime, were employed according to their skills—as brick makers, carpenters, nurses, servants, cattlemen, shepherds and farmers.

Educated convicts were set to the relatively easy work of record-keeping for the convict administration. Women convicts were assumed to be most useful as wives and mothers, and marriage effectively freed a woman convict from her servitude.

From 1810, convicts were seen as a source of labour to advance and develop the British colony. Convict labour was used to develop the public facilities of the colonies—roads, causeways, bridges, courthouses and hospitals. Convicts also worked for free settlers and small land holders.

The discipline of rural labour was seen to be the best chance of reform. This view was adopted by Commissioner Bigge in a series of reports for the British Government published in 1822-23. The assignment of convicts to private employers was expanded in the 1820s and 1830s, the period when most convicts were sent to the colonies, and this became the major form of employment.

Convicts formed the majority of the colony's population for the first few decades, and by 1821 there was a growing number of freed convicts who were appointed to positions of trust and responsibility as well as being granted land.

In the mid-1830s only around six per cent of the convict population were 'locked up', the majority working for free settlers and the authorities around the nation. Even so, convicts were often subject to cruelties such as leg-irons and the lash. Places like Port Arthur or Norfolk Island were well known for this. Convicts sometimes shared deplorable conditions. One convict described the working thus:

'We have to work from 14-18 hours a day, sometimes up to our knees in cold water, 'til we are ready to sink with fatigue... The inhuman driver struck one, John Smith, with a heavy thong.'

The experience of these convicts is recorded through the first Australian folk songs written by convicts. Convict songs like Jim Jones, Van Diemen's Land, and Moreton Bay were often sad or critical. Convicts such as Francis Macnamara (known as 'Frankie the Poet') were flogged for composing original ballads with lines critical of their captors.

In addition to the physical demands of convict life, some convicts arrived without sufficient English to communicate easily with others:

By 1852, about 1,800 of the convicts had been sentenced in Wales. Many who were sent there could only speak Welsh, so as well as being exiled to a strange country they were unable to speak with most of their fellow convicts.

Also telling of convicts' experiences were convict love tokens, mainly produced in the 1820s and 1830s by transported convicts as a farewell to their loved ones. Made from coins such as pennies, most of the engraved inscriptions refer to loss of liberty. One token, made from a penny for convict James Godfrey, is dedicated to his love, Hannah Jones. The inscription reads:

'When in Captivity
Time Goeth Very slow.
But Free as air To roam now
Quick the Time Doth Go'.

When the last shipment of convicts disembarked in Western Australia in 1868, the total number of transported convicts stood at around 162,000 men and women. They were transported here on 806 ships.

The transportation of convicts to Australia ended at a time when the colonies' population stood at around one million, compared to 30,000 in 1821. By the mid-1800s there were enough people here to take on the work, and enough people who needed the work. The colonies could therefore sustain themselves and continue to grow. The convicts had served their purpose.

While the vast majority of the convicts to Australia were English and Welsh (70%), Irish (24%) or Scottish (5%), the convict population had a multicultural flavour. Some convicts had been sent from various British outposts such as India and Canada. There were also Maoris from New Zealand, Chinese from Hong Kong and slaves from the Caribbean.

A large number of soldiers were transported for crimes such as mutiny, desertion and insubordination. Australia's first bushranger, John Caesar, sentenced at Maidstone, Kent in 1785 was born in the West Indies.

Most of the convicts were thieves who had been convicted in the great cities of England. Only those sentenced in Ireland were likely to have been convicted of rural crimes. Transportation was an integral part of the English and Irish systems of punishment. It was a way to deal with increased poverty and the severity of the sentences for larceny. Simple larceny, or robbery, could mean transportation for seven years. Compound larceny—stealing goods worth more than a shilling (about $50 in today's money)—meant death by hanging.

Men had usually been before the courts a few times before being transported, whereas women were more likely to be transported for a first offence. The great majority of convicts were working men and women with a range of skills.

Good behaviour meant that convicts rarely served their full term and could qualify for a Ticket of Leave, Certificate of Freedom, Conditional Pardon or even an Absolute Pardon. This allowed convicts to earn their own living and live independently. However, for the period of their sentence they were still subject to surveillance and the ticket could be withdrawn for misbehaviour. This sanction was found to work better in securing good behaviour than the threat of flogging.

The ticket of leave licences were developed first to save money, but they then became a central part of the convict system which provided the model for later systems of probation for prisoners.

Governor King (1800-1804) first issued tickets of leave to any convicts who seemed able to support themselves, in order to save on providing them with food from the government store. The tickets were then used as a reward for good behaviour and special service, such as informing on bushrangers. Gentlemen convicts were issued tickets on their arrival in the colony, although Governor Macquarie (1810-1821) later ordered that a convict had to serve at least three years before being eligible.

Governor Brisbane (1821-1825) finally set down regulations for eligibility. Convicts normally sentenced to seven year terms could qualify for a Ticket of Leave after four years, while those serving 14 years could expect to serve between six to eight years. 'Lifers' could qualify for their 'Ticket' after about 10 or 12 years. Those who failed to qualify for a pardon were entitled to a Certificate of Freedom on the completion of their term.

Transportation to the colony of New South Wales was officially abolished on 1 October 1850, and in 1853 the order to abolish transportation to Van Diemen's Land was formally announced.

South Australia, and the Northern Territory of South Australia, never accepted convicts directly from England, but still had many ex-convicts from the other States. After they had been given limited freedom, many convicts were allowed to travel as far as New Zealand to make a fresh start, even if they were not allowed to return home to England.