Key physicochemical factors associated with microbial community composition and functions in Australian agricultural soils were identified. Soils from seven field sites, with varying long-term agricultural management regimes, were characterised physicochemically, on the basis of their bacterial and fungal community structures (using PCR-DGGE), and by assessing potential catabolic functions (MicroResp™). Soil type, rather than agricultural management practice, was the key determinant of microbial community structure and catabolic function (P<0.05). Following multivariate analysis, soil pH was identified as the key habitat-selective physicochemical soil property associated with variation in biological diversity and profiles of organic substrate utilisation. In particular, the capacity of soils to catabolise different C-substrates was closely correlated (ρ=0.604, P=0.001) to pH. With decreasing pH, the catabolism of common low molecular weight organic compounds (especially cysteine and aspartic acid) declined, however catabolism of two others (lysine and arginine) increased. Shifts in the capacity of soil microbiota to cycle common organic compounds have implications for overall geochemical cycling of C and N in acidifying soils. The genetic structure of the bacterial communities in soil strongly correlated with pH (ρ=0.722; P=0.001) and that of soil fungi with pH and % sand (ρ=0.323; P=0.006). Catabolic function was more closely associated with the structure of the bacterial than fungal communities. This work has shown that soil pH is a primary driver of microbial diversity and function in soil. Agricultural management practices thereby act to selectively shift populations and functions against this background.