This article examines changes in women’s participation in the workforce and female wage rates in late nineteenth and early twentieth century Australia, focusing on the period of boom, depression and recovery from 1890 to 1910. Instead of explaining the trends in terms of family income or labour market segmentation, it is argued that the changes observed can be explained on the basis of sex-based discrimination in the labour market. Evidence from Victorian manufacturing during this period supports the discrimination hypothesis. Statistics for manufacturing industry in Brisbane during this period also give support to the discrimination hypothesis. As the economy slipped into depression and the general level of incomes fell, people were less willing to pay the price of prejudice against women workers. Both employment discrimination and wage discrimination against women were temporarily alleviated. Consequently there was the concurrence of rising employment of women relative to men and rising women’s wages relative to men’s wages.