Three features are emphasised; the role and impact of foreign debt, Australian experiences since the beginning of the 'eighties, and the implications of the growth of foreign debt. Aggregate data on foreign debt is provided along with classifications by users, maturities and currencies. The dominant role of banks in intermediating private sector foreign borrowing is spelt out. The significance of this foreign debt is analysed in conventional macroeconomic terms to stress the instability likely when that debt grows rapidly in relation to national output. A strongly market-oriented view rejects that interpretation. However, instability should not necessarily be attributed to foreign debt alone because foreign portfolio investment exhibits some similar features to debt.