Broadly speaking, Australia is split into three vertical bands for the purposes of time zones along state boundaries. These divisions run along the Western Australia border with South Australia and the Northern Territory, and the border between the Northern Territory and Queensland and between South Australia and New South Wales/Victoria.

These three divisions are known as Australian Western Standard Time (AWST), Australian Central Standard Time (ACST) and Australian Eastern Standard Time (AEST). The southern states within these time zones generally adopt daylight savings time during the summer months, whereas the northern states do not. Western Australia trialled daylight savings time for a period of three years from 2006 to 2009 but then opted not to adopt it permanently.

There are several areas in Australia which do not follow the time zones outlined above:

Broken Hill, a town in western New South Wales uses the ACST time zone of neighbouring South Australia rather than that of it's state.

Eucla, Cocklebiddy, Madura and Mundrabilla on the Eyre Highway in the south-east corner of Western Australia (near the South Australia Border) follow their own unofficial time zone, half-way between Western Australian and South Australian time. Known as "Central Western Standard Time" (CWST) this is 8 hours and 45 minutes ahead of UTC.

Australia's external islands and antarctic territories also follow their own time zones based on their locations.