The Australian fossil record shows that from ca. 25 Myr ago, the aseasonal–wet biome (rainforest and wet heath) gave way to the unique Australian sclerophyll biomes dominated by eucalypts, acacias and casuarinas. This transition coincided with tectonic isolation of Australia, leading to cooler, drier, more seasonal climates. From 3 Myr ago, aridification caused rapid opening of the central Australian arid zone. Molecular phylogenies with dated nodes have provided new perspectives on how these events could have affected the evolution of the Australian flora. During the Mid–Cenozoic (25–10 Myr ago) period of climatic change, there were rapid radiations in sclerophyll taxa, such as Banksia, eucalypts, pea–flowered legumes and Allocasuarina. At the same time, taxa restricted to the aseasonal–wet biome (Nothofagus, Podocarpaceae and Araucariaceae) did not radiate or were depleted by extinction. During the Pliocene aridification, two Eremean biome taxa (Lepidium and Chenopodiaceae) radiated rapidly after dispersing into Australia from overseas. It is clear that the biomes have different histories. Lineages in the aseasonal–wet biome are species poor, with sister taxa that are species rich, either outside Australia or in the sclerophyll biomes. In conjunction with the fossil record, this indicates depletion of the Australian aseasonal–wet biome from the Mid–Cenozoic. In the sclerophyll biomes, there have been multiple exchanges between the southwest and southeast, rather than single large endemic radiations after a vicariance event. There is need for rigorous molecular phylogenetic studies so that additional questions can be addressed, such as how interactions between biomes may have driven the speciation process during radiations. New studies should include the hitherto neglected monsoonal tropics.