Theme park bosses who were given more than $2.7million (£1.5million) in government cash to build a koala research company "redirected" the money to erect a high-speed rollercoaster instead.
The move, which has angered environmentalists, was given the go-ahead by Queensland's tourism and innovation minister, Stirling Hinchcliffe.
He said the government gave the go-ahead for the repurposing, citing a need to bolster international and local tourism in the region due to the impact of coronavirus.
The funding was initially designated to Dreamworld on Australia's Gold Coast in 2019 to support the creation of a new state-of-the-art koala research facility.
It would have given guests a glimpse into scientific conservation methods.
The money instead went towards building the theme park's Steel Taipan rollercoaster.
Dreamworld's website described the ride as "Australia's only triple launch coaster with a top speed of 105km/h and a G-force of 3.8".
Gold Coast City Council councillor Hermann Vorster told Nine News: "I think the government has helped Dreamworld build a ride but the taxpayer has been taken for a ride and unfortunately the koalas have become short-changed too.
"I think it's ridiculous to be blaming covid on this decision.
"Koalas need our help yesterday, they need our help today and they'll always need our help tomorrow.
"The community should have had full transparency if the government changed their minds because maybe then people would change the government."
A Dreamworld spokeswoman said: "Dreamworld acknowledges and thanks the Queensland government for permission to repurpose the grant in question for the building of Steel Taipan; an attraction offering tremendous benefit to the rebuilding of the tourism industry and to employment in Queensland.
"Dreamworld is committed to conservation and makes meaningful change via the Dreamworld Wildlife Foundation, which has raised over $3.5 million for animal conservation and continues to fund important conservation projects in Australia and internationally."
