This research seeks to analyse the phenomenon of ethnic business creation amongst the ethnic community in Australia. The main emphasis is on finding the reasons for the process of ethnic business creation over time, focusing on the ethnic resources that the intending ethnic business operators bring to such activities through links to their country of origin. This is a resource-based study, which looks at ethnic resources as a means of sustained competitive advantage and as strategy for success in ethnic business operations in Australia. It attempts to gauge the extent of interactive processes between business operations and the relevant ethnic resources, some of which have a great influence in determining ethnic business people’s success. Policies aimed directly at facilitating, encouraging and strengthening these processes would be a valuable development. This research also examines the theories of small business development and identifies their applicability and relevance to the development of ethnic small business in Australia. The findings of this study enabled the development of a new theory and model for ethnic business creation that links the creation and success of ethnic small businesses to the use of productive diversity principles. / Doctor of Philosophy (PhD)