The capital of Australia is Canberra, a planned city located in the Australian Capital Territory (ACT). Unlike Sydney or Melbourne, which are larger and more internationally known, Canberra was specifically chosen as the capital in 1908 as a compromise between these two rival cities. It serves as the political and administrative center of Australia, housing the Parliament House, the High Court, government departments, and diplomatic missions. The city is also known for its carefully designed layout, extensive green spaces, and national monuments, making it a hub for both governance and culture.