Prime Minister Scott Morrison has described Australia Day as a day for optimism about the country, as protesters gathered at Invasion Day demonstrations in major cities.
Speaking following the national flag-raising and citizenship ceremony in Canberra, Mr Morrison said the public holiday was a time to celebrate together as a nation.
"Today is a day for optimism and positivity about the great country we're all blessed to live in," he told reporters.
Earlier in the day, the prime minister congratulated 19 new citizens who were conferred at the ceremony, while also paying tribute to newly crowned Australian of the Year Dylan Alcott.
"You'll be given the inheritance of our history, and the promise of our shared future," he said.
"But you don't come to our national story empty-handed either. Like so many before you, you add your threads to Australia's rich tapestry."
Australia Day will see more than 16,000 new citizens be conferred, with more than 400 similar ceremonies being held nationwide.
Opposition Leader Anthony Albanese said the day was a chance to celebrate Australia's achievements, while also calling for recognition of Indigenous people in the constitution.
"We've continued to develop as a multicultural nation and evolve and we need to continue to do that into the future," he said.
"In order to do that, we need to recognise that our history goes back at least 60,000 years."
It comes as Invasion Day rallies were held across the country.
Protesters gathered at the Aboriginal Tent Embassy, marking its 50th anniversary, while demonstrations were also held in major capital cities.
While the date of Australia Day remains contentious, a new Roy Morgan poll shows 65 per cent of Australians say January 26 should be considered "Australia Day" - up six points on a year ago - with 35 per cent saying "Invasion Day" is more appropriate.
However, the figures are reversed when it comes to Australians under 25, with 64 per cent in favour of "Invasion Day".
Meanwhile, a Guardian-Essential poll showed nearly 60 per cent of respondents backed either changing the date, or keeping the day but establishing a separate day to recognise Indigenous people.
In Melbourne, a statue of Captain Cook was vandalised with red paint in a gesture to support Invasion Day.
When asked about whether the date should be changed, Mr Albanese said he was interested in ways to unite the nation, rather than divide.
"It's important we're able to have conversations about Australia's future direction," he said.
Governor-General David Hurley said it had been a difficult two years, but Australia was turning a corner with optimism.
"I know there are tough days - we've wept with people, we've comforted people - but we are at heart a good people," he said.
"Not afraid of hard work, we're creative, we're innovative, and we can take on anything. We're the product of our past, and the sum of each of our individual stories ... (and) that, I believe, is worth celebrating here on Australia Day."
The National Australia Day Council has supported 534 local community events and activities with grants.
