When Captain James Cook sailed into this blue-water bay 230 years ago, he touched ground that Britain would soon declare terra nullius -- a land empty of human beings that it would later fill with its convicts.
But the truth, of course, was never that easy.
When the landing party from Cook's ship HMS Endeavour came ashore on April 28, 1770, they were met by two aboriginals who left no doubt about what they thought of the white newcomers: They hurled spears at them.
The encounter foreshadowed the clashes that continue to define the relationship between Australia's newcomers and its dark-skinned aboriginals.
It is a relationship that is one of the few things that might tarnish the 27th Olympic Games, which begin Friday . On the spot where Cook landed on Botany Bay, aboriginals have erected a small tent village. In its centre is "the peace flame," a campfire lit with a torch that aboriginal elders carried from the outback.
"We aboriginals are an angry people," declared Annie Murray, a young student who stood at a camp on Botany Bay. "In the opening ceremony of the Olympics, you will see Australia use aboriginal art, our children as performers in the opening and closing ceremonies, some of our athletes as competitors, and our music as one of the theme songs.
"But the world needs to know that in the real Australia we are still second-class citizens. Even in Canada, your native Indians have more rights, more respect and better treaties than we do here."
The Australian government's own statistics prove that a grave inequality permeates its society, which began to dismantle its "White Australia" policies only in the 1960s.
An aboriginal man lives on average to 57 years, 19 years less than other Australian men. Nineteen of every 1,000 aboriginal infants die at childbirth, compared with only five for the general population. And 7.6 per cent of Aborigines are in prison, compared with 1.1 per cent of the larger population.
A black face in downtown Sydney is a rarity. Those seen today are usually Olympic athletes -- from Africa or the United States.
Where the aboriginals do live is a run-down and violent quarter known as Redfern.
On a recent visit into the area, a taxi driver stopped in front of a burned-out house and within one minute was robbed by an aboriginal boy, an addict in search of his next fix.
After a brief chase and scuffle, the teenager returned the money, but not without local residents warning an outsider never to go into the neighbourhood unescorted.
"Don't be doing that again, mate," said Rodney Murray, who helped defuse the violent robbery. "You might get a knife in the guts. Sorry, this sort of thing gives the aboriginal community a bad name. The Olympics may be on, but there's nothing in that for us down here."
In a park near Sydney's downtown, a 10-minute walk from Redfern and in the shadow of the city's five-star hotels and restaurants, aboriginals have set up a "tent embassy" to press their case for an apology by the Australian government.
Australia won the Olympics over Beijing largely because of China's record on human rights, said Isabel Coe, a community leader who hopes for a peaceful demonstration during the Games. "But we ask, what about Australia's human-rights record? What about us? We don't want violence, but we do want some justice."
Many of Australia's leading intellectuals have come out strongly for promoting the aboriginal cause during the Olympics.
"Australia is a community that has its own internal and urgent need to achieve reconciliation with its native populations," Thomas Keneally, author of Schindler's Ark, which became the movie Schindler's List, recently wrote.
Australia's leaders have not come close to healing the wounds, what a judge described this week as "the running sore of racial antagonism in our country."
Prime Minister John Howard has resolutely refused to offer an official apology. He has acknowledged "deep personal sorrow for Australians who suffered under the practices of past generations toward indigenous people," and said he is "sorry for the hurt and trauma many people many continue to feel as a consequence of those practices."
But he has held steady to his view, supported by about half the population, that the current generation should not be held accountable for the sins of their ancestors. He believes such a statement would divide society and have legal consequences that could have ramifications in continuing land-claims cases.
Still, the Olympics are bringing unparalleled attention to the aboriginal cause. That is reflected in the Olympic official souvenir program, usually a glossy affair meant to put the best possible light on the event and its host city. Sydney's version is unusually critical of the past.
Aboriginal novelist Archie Weller has an article outlining some of the indignities foisted upon past aboriginal athletes. Among them is the story of Charlie Samuels. As Australia's fastest man in the late 1880s, he won fortunes for his white backers. But he was later shipped off to an asylum "because of alcohol-induced hallucinations."
After that, he was forced by Australia's government to the Barambah reserve, a brutal camp where he died at the age of 49, all but forgotten.
Another aboriginal athlete highlighted is Bobby McDonald, who is said to have invented the 100-metre crouch in 1887, when he was cold before a race start. "Many believed it was modelled on the stance of the kangaroo," writes Mr. Weller, who goes on to cite Canada as a model for his countrymen to emulate. "There has been damage from broken promises, land disputes and the federal government refusal to say 'Sorry,' " Mr. Weller writes. "In stark contrast, Canada had the decency to apologize to its First Nations -- and also give the Inuit people the homeland and autonomy they had long desired." But the Olympics do seem to be a catalyst for change.
Still, many Australians resist an overture to the aboriginals.
"We don't owe the abos any thing at all," said Greg Jones, a construction worker in a Sydney pub who was cheered by those who heard him. "They may have been here first, for thousands of years, but we whities built this damn city and country in 200 years."
Yet many Australians will be cheering sprinter Cathy Freeman, the country's No. 1 favourite. She's an aboriginal who recently attacked the government for its past racism.
If Ms. Freeman wins the gold medal, she is expected do a victory lap with the flag. But it will be the aboriginal flag, spread out for the world, all of Australia and 385,000 aboriginals to see.