Macrobrachium australiense is a common freshwater prawn found throughout most of eastern and inland Australia. Debate has been ongoing on the systematics of this species due to high morphological variation: past studies have relied on external morphology assessments to describe genetic relationships between populations. An individual's morphological phenotype results however, from an interplay of genetic factors, environmental, and interactions between genes and the environment. The current study examined the strength of genetic constraint on morphological traits in this species. Examination of over 1000 M. australiense museum specimens collected from across the species' extensive natural range, documented high phenotypic variation with no regional pattern of variation. Within regions, 88% of variation in morphological traits in mature males and juveniles was present between local rivers. Therefore, morphological variation is not structured at the regional level. If there is a strong genetic base to morphological variation then populations in a single river system must be evolving essentially in isolation. More intensive sampling within a single river system demonstrated high morphological variation in 600 M. australiense individuals from 18 populations within a geographically connected system. Populations separated by as little as 1km showed significant morphological differences in 50% of mature male traits. If morphological variation is primarily genetically based, then populations within a river system were evolving independently at a very fine spatial scale. This hypothesis was tested by breeding morphologically divergent populations of M. australiense in a controlled environment to isolate genetic influences on morphological variation. Low heritability for morphological traits in five divergent populations raised under identical environments established that there is no strict genetic control on morphological variation in these M. australiense populations. Morphologically homogenous offspring resulted from wild parents that had exhibited significant differences at 73% of traits examined. Therefore, the fundamental assumption that morphological variation in M. australiense is dictated by strict genetic control is not supported in these representative populations. Moreover, significant variation in 41% of morphological traits was produced by raising a single population at different environmental temperatures (28oC and 22 oC). A single homogenous stock of M. australiense should not produce morphologically divergent offspring if genetic factors are the major influence of phenotypic expression. Crossing of pure line divergent stocks resulted in hybrid offspring with significant differences in 50% of female morphological traits, whereas male offspring varied for only 31% of morphological traits. This result suggests that female morphological expression is affected more strongly by genetic factors than male offspring in this trial. The growth and maturation of external morphological traits during development in M. australiense is under limited genetic constraint, especially in the later phases of growth. Only 17% of traits varied between juvenile stocks in the last three months of development when individuals were exposed to identical environmental conditions. Maturation size was homogenous, except for females in the absence of maturing males in divergent stocks exposed to identical environmental conditions. Females were much larger in size and shape of morphological traits in the absence of mature males in the population. Thus environmental factors strongly influence phenotypic expression of external morphology in M. australiense. Past problems with the taxonomy of this species are therefore understandable as many important traits used in systematics appear to be under limited genetic control. Past evolutionary studies based on morphological diversity in this species therefore may be unreliable as the traits used to identify divergent forms may not provide a true reflection of genetic divergence.