Religious diversity and social cohesion have long been seen to be at odds with each other. Classical sociology, grounded in the Westphalian solution to religious conflict in Europe presumed that a single religion was necessary for social cohesion. The issue of religious diversity and social cohesion has come to the fore as once religiously monochrome societies have become diverse through migration and, to a lesser degree, conversion. While European nations question the possibility of multicultural and multi-faith societies living in productive harmony, Australia offers an example of a successful multicultural and multi-faith society. Australia has produced a multicultural society through a policy of social inclusion and mutual respect, in contrast to European policies which produce separate community development. This cross-national comparative study reveals demographic and socio-cultural differences that are likely to explain some of the comparative success of Australia in producing social inclusion and avoiding the ‘othering’ of religious minorities, especially of Muslims. Australia has a particular demographic that features multiple substantial minority religious communities living in ways that promote daily encounters among people of different backgrounds.