This paper examines the importance of the postwar settlement to Australian international policy. In particular, it considers how the postwar settlement of American regional primacy and economic dominance became built into the foundations of Australian international engagement and its long-term consequences. The first part of the paper explains how this occurred and why it is so important to Australia’s current policy dilemmas. The second part of the paper examines how changes to the fundamental structures of the 1945 regional strategic settlement, focusing primarily on Northeast Asia, are driving shifts in Australian policy. It concludes with a reflection on the choices Australia has made about its strategic future as it is heavily invested in the belief that U.S. primacy can endure over the long term.