MELBOURNE has claimed gold as the world's most liveable city for the second year in a row but Sydney has lost its status as Australia's second-most desirable destination to Adelaide.
Melbourne has edged out Austria's capital Vienna to claim the Global Liveability Survey title of the best city in the world to live in for the second year running.
Adelaide, Sydney and Perth have also featured in the top 10, while Vancouver - rated third - is one of three Canadian cities listed among the top destinations.
But it's Adelaide's ranking above Sydney that is likely to be the biggest local talking point, with the City of Churches ranked equal fifth, two places above.
Economist Intelligence Unit (EIU) survey editor Jon Copestake says while Melbourne enjoys top bragging rights, there is little separating the top Australian cities.
Four of the five surveyed made it into the top 10 globally and were separated by just 1.6 percentage points. Brisbane was number 20.
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"Australian cities continue to thrive in terms of liveability - not only do they benefit from the natural advantages of low population density, but they have continued to improve with some high profile infrastructure investments," Mr Copestake said in a statement.
"In Adelaide, projects completed in recent years under the Strategic Infrastructure Plan for South Australia have been enough to move the city above Sydney, whose score is unchanged (from 2011)."
The global liveability survey is an annual list compiled by the EIU, initially as a test of whether human resource departments needed to pay a hardship allowance in expatriate relocation packages.
Melbourne's score of 97.5 per cent is close to the perfect score, with the city only losing points for climate, culture and petty crime.
Adelaide lost points on culture and environment but new infrastructure in the city catapulted it above Sydney.
The harbour city scored well in health care, education and infrastructure but was regarded the least stable among the list of top 10 cities in a category that considers crime, the terror threat and the risk of civil unrest.
Mr Copestake said the impact of the Arab Spring and the Euro zone crisis were significant factors in the 2012 global rankings.
At the other end of the scale Dhaka in Bangladesh was rated the least liveable city of the 140 considered in the survey.
The world's top 10 most liveable cities:
1. Melbourne, Australia.
2. Vienna, Austria.
3. Vancouver, Canada.
4. Toronto, Canada.
5. Calgary, Canada.
5. (equal) Adelaide, Australia.
7. Sydney, Australia.
8. Helsinki, Finland.
9. Perth, Australia.
10. Auckland, New Zealand.
20. Brisbane, Australia.
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Second year in a row and all Australian capital cities are int he top 20