In early 1991 the drought began to affect southern Queensland and north-west New South Wales. By October the same year 65 per cent of both states were under drought conditions.

During 1992-1993 there was some improvement in conditions where rain fell but this was inconsistent and often short-lived. In early 1994 the drought extended significantly affecting most of New South Wales and Victoria, encroaching on southern South Australia the south and west of Western Australia and north-eastern Tasmania.

As 1994 went on, the drought steadily worsened; by September 1994, about 83 per cent of New South Wales and 40 per cent of Queensland was drought declared.

In September 1994, the Commonwealth announced a total drought assistance package assessed to total $164 million over two years. Over the course of this drought average, rural production fell by over 10 per cent and rural unemployment rose. The loss to the economy is estimated at around $5 billion.