Evidence from overprinting of magnetizations of Late Permian and Mesozoic rocks and from the rank of Permian coals and Mesozoic phytoclasts (coal particles) suggests that surface rocks in the Sydney Basin, eastern Australia, have been raised to temperatures of the order of 200 ¿C or higher. As vitrinite reflectance, an index of coal rank or coalification, is postulated to vary predictably with temperature and time, estimates of the paleotemperatures in the Sydney Basin based on observed vitrinite reflectance measurements can be made in conjunction with reasonable assumptions about the tectonic and thermal histories of the basin. These estimates give maximum paleotemperatures of present day surface rocks in the range 60--249 ¿C, depending on factors such as location in the basin, the thickness of the sediment eroded, and the maximum paleogeothermal gradient. Higher coal rank and, consequently, larger eroded thicknesses and paleogeothermal gradients occur along the eastern edge of the basin and may be related to seafloor spreading in the Tasman Sea on the basin's eastern margin. A theory of thermal activation of magnetization entailing the dependence of magnetic viscosity on the size distribution of the magnetic grains is used to obtain an independent estimate of the maximum paleotemperatures in the Sydney Basin. This estimate places the maximum paleotemperature in the range 250--300 ¿C along the coastal region. Both coalification and thermal activation of magnetization models provide strong evidence of elevated paleotemperatures, which in places exceed 200 ¿C, and the loss of sediment thicknesses in excess of 1 km due to erosion.