The LGBTIQ community's night of nights dazzled about 300,000 spectators on Sydney's famous Oxford Street with pop superstar Cher making an appearance for the 40th Mardi Gras parade.
Confetti, glitter and rainbow flags lined Oxford Street for Saturday's parade, the first since same-sex marriage was legalised in Australia.
Gay icon Cher, sporting orange hair, was a hit with the thousands of spectators as she stepped out on to Taylor Square.
The singer said she loved the atmosphere of the parade.
"I love that everybody is having such a good time and there's no feeling of any kind of anger, there's no negativity and that's what I like most," Cher told reporters.
"All the people with everything hanging out, and fabulous girls with there slap on and big hair and no clothes - I love it!"
Among those to join the festivities were Prime Minister Malcolm Turnbull and his wife Lucy, who made an appearance after the Dykes on Bikes and Boys on Bikes kicked off the evening's festivities.
Mr Turnbull described the parade as a "wonderful part of Sydney".
Federal Opposition Leader Bill Shorten was part of the Rainbow Labor float with his wife Chloe and his deputy Tanya Plibersek.
He said it was a "fantastic atmosphere" and showed that Australia was making progress.
Labor Senate leader Penny Wong, Liberal Senator Dean Smith and federal Greens leader Richard Di Natale joined together on the Equality Campaign float.
About 200 floats made their way up the popular city strip, among them 250 people who were involved in the 1978 demonstration and subsequent riot.
One of them was 78er Peter De Waal who said Australia's transformation had been liberating.
More than 12,000 people took part in this year's parade, including Australian model Jesinta Franklin who was on the Rainbow Swans float, reportedly the first float entered by a professional sporting team.
More than 1000 police officers kept a close eye on revellers as part of a huge security operation that involved strategically parked vehicles, an intelligence crew, mounted police, the riot squad and sniffer dogs.
Five people were arrested during the night's festivities in two separate incidents at Pitt Street and Hyde Park, a NSW Police spokeswoman told AAP.
Three males were issued future court attendance notices for offences including resisting arrest, offensive behaviour, assaulting police and failure to comply with instructions.
Several move-on directions were also issued by NSW Police.
Australian Associated Press