With the discovery of gold in the region, the future of the new colony was assured. Victoria's population increased by 95,000 in the year following the first strike.

Boatloads of immigrants joined thousands on the gold fields of Ballarat, and many fortunes were made literally overnight, filling the banks throughout mining districts, and in Melbourne too, with gold. In the 1850s, an amazing 90% of Australia's gold was coming from Victoria.

Though often bringing great riches, life on the goldfields was hard, and was made even more difficult by the tactics of a government that sought to increase colonial revenue. Strict licensing of the miners at 30 shillings a month was introduced, as well as increased license surveillance. Discontent and anger rose quickly through the fields, and soon the fields became embroiled in an uproar.

Provoked by an incident, which saw a miner kicked to death outside a hotel and the charges against the perpetrators dismissed in a trial marked by favouritism, the incensed miners called a public meeting for 17 October 1854 to have the case fairly heard, and to establish a fund to provide a reward for evidence leading to the conviction of the murderers.

Between three and five thousand miners assembled and elected a committee to carry out the wishes of the assembly, and following a confrontation with the police the meeting ended with the crowd setting fire to the Eureka Hotel, and only three arrests.

The incident led to an increase of troops posted in Ballarat, and the miners involved in the fire were imprisoned. The original crime was fairly tried earning the publican of the Hotel three years with hard labour - however trouble on the diggings continued leading to riots and battles with the Regiments.

These incidents were to develop into one of the greatest pieces of Australian mythology culminating in what was to become known as the battle of the Eureka Stockade. On November 30, miners refused to show their licences, and a battle began with miners pelting police with stones. The miners quickly erected barricades on the Eureka claim and raised the blue Southern Cross flag. Miners from Creswick had joined those from Eureka, and the situation had escalated.

Hearing of a plan by the miners to intercept military enforcements coming into Ballarat, more than 250 troops stormed the rebels in the early hours on December 3. Following ten minutes of heavy firing and hand fighting with bayonets and spikes, 125 diggers were held prisoner, 22 were dead and 29 injured, and six soldiers were killed.

At the subsequent trials held in Melbourne, juries refused to convict any of the miners, and Peter Lalor, elected leader of the rebellion, was later to spend 30 years within the Legislative Assembly.

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