Australia

In 1939, Lady Sarah Ashley (Nicole Kidman) travels from England to northern Australia to force her husband to sell his faltering cattle station, Faraway Downs. Her husband sends an independent cattle drover (Hugh Jackman), called simply "Drover", to Darwin to transport her to Faraway Downs. Lady Sarah's husband, who has been trying to sell 1,500 head of cattle to the military, is murdered shortly before she arrives. Meanwhile, Faraway Downs' manager Neil Fletcher (David Wenham) is trying to gain control of Faraway Downs so that Lesley "King" Carney (Bryan Brown) can have a monopoly in the Northern Territory, which will give him leverage with the Australian army. Fletcher claims that the murderer of her husband is an Aboriginal elder with magical powers, "King George" (David Gulpilil).

The childless Lady Sarah is captivated by the young boy Nullah (Brandon Walters), who was born to an Aboriginal mother and an unknown white father. Nullah tells her that he has seen her cattle being driven onto Carney's land — in other words, stolen. Because of this, Fletcher mistreats Nullah and threatens him and his mother. Nulluh proves to Lady Sarah that Fletcher is a liar by showing her that the windmill, which Fletcher has deemed broken, is instead fully functional. Lady Sarah fires Fletcher and decides to run the cattle station herself.

Sergeant Callaghan arrives to try to take Nullah away, so Nullah and his mother hide from him in a water tower. One of the officers accompanying the Sergeant tries out the water windmill, and Nullah's mother drowns while saving him. Afterwards, Lady Sarah comforts Nullah by singing "Over the Rainbow" from the film The Wizard of Oz. Nullah finds a great interest in the song, and proceeds to tell her that King George is his grandfather, and that like King George he too is a "magic man".

Lady Sarah persuades Drover to take the cattle to Darwin for sale so that Faraway Downs can be saved. Drover, a white man, is friendly with the Aborigines, and therefore shunned by many of the other whites in the territory. He had married an Aboriginal woman, but she died after being refused medical treatment in a local hospital because of her race. Drover leads a team of six riders, including Lady Sarah, Drover's Aboriginal brother-in-law Magarri (David Ngoombujarra), Nullah, and the station's accountant Kipling Flynn (Jack Thompson), to drive the 1,500 cattle to Darwin. Carney's men set fires to make the cattle stampede, and Flynn is killed. At the last minute, Nullah stops the cattle from stampeding over a cliff by apparently using magic learned from his grandfather. Lady Sarah and Drover develop a romance, and she gains appreciation for the Australian territory. Carney's men poison all the water sources along the cattle-drive route, so the group risks driving the cattle through the dangerous Never Never desert, which they accomplish with the help of King George. Delivering the cattle in Darwin, the group races them onto the ship before Carney's cattle are loaded. That night, Lady Sarah and Drover attend a ball for the "Children's Island Mission" and decide to keep Faraway Downs.

Two years later, Lady Sarah, Nullah and Drover live together at Faraway Downs. However, Fletcher kills Carney and frames it as a tragic accident, marries his daughter Catherine Carney, takes over Carney's empire, and continues to menace Lady Sarah. It is determined that Fletcher was the actual murderer of Lady Sarah's husband and that Fletcher is also almost certainly the father of Nullah. Nullah is drawn to perform a ceremonial coming-of-age walkabout with his grandfather "King George", but is instead captured by the authorities and sent to live on Mission Island with the rest of the half-Aboriginal children (dubbed the "Stolen Generations"). Lady Sarah vows to find him again, and while trying to secure Nullah's return, begins working as a radio operator in Darwin during the escalation of World War II. Lady Sarah prepares to sell Faraway Downs to Fletcher, believing that it will aid her in gaining Nullah back. The sale is interrupted by the Japanese bombing of Darwin and Mission Island. Lady Sarah fears that Nullah has been killed.

Drover, who had quarrelled with Lady Sarah and gone droving apparently never to return, hears (mistakenly) that she has been killed in the bombing. (It is later revealed that the dead woman thought to be Sarah is in fact Catherine Fletcher, who volunteered to take Sarah's shift at army radio headquarters so Sarah could go to Nullah.) Drover finds out about Nullah's abduction and sets out with Magarri and Ivan (the hotelier) to rescue the children from the island. When Japanese soldiers arrive, Magarri sacrifices himself to buy the others time to escape. Lady Sarah and the inhabitants of Darwin prepare to evacuate on the last convoy out of the city. When Drover and the children sail back into Darwin, Nullah plays his harmonica with the tune of "Over the Rainbow". Lady Sarah hears the music and reunites with the three.

Fletcher, watching them, knows Nullah is the one link that can relate him to a past that would ultimately ruin him, also concluding that the boy must have cursed him, and so he attempts to shoot Nullah. King George witnesses Fletcher from the top of a tanker just as Fletcher is about to fire, and spears Fletcher through the chest just as he pulls the trigger. Lady Sarah watches as Nullah falls to the ground and Drover rushes over to him. As Drover holds him in his arms, Nullah opens his eyes, and smiles, revealing that the bullet was a blank. Lady Sarah, Drover, and Nullah return to the safety of remote Faraway Downs. On the way back to Faraway Downs, King George calls for Nullah, his grandson, to go walkabout. Lady Sarah embraces Nullah and lets him go to his grandfather, who explains that they will return to his land, and then looking at Lady Sarah, says "our land".

Cast
Nicole Kidman
Hugh Jackman
David Wenham




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