Island populations of animals are expected to show reduced genetic variation and increased incidence of inbreeding because of founder effects and the susceptibility of small populations to the effects of genetic drift. Koalas (Phascolarctos cinereus) occur naturally in a patchy distribution across much of the eastern Australian mainland and on a small number of islands near the Australian coast. We compared the genetic diversity of the naturally occurring population of koalas on North Stradbroke Island in south-east Queensland with other island populations including the introduced group on St Bees Island in central Queensland. The population on St Bees Island shows higher diversity (allelic richness 4.1, He = 0.67) than the North Stradbroke Island population (allelic richness 3.2, He = 0.55). Koalas on Brampton, Newry and Rabbit Islands possessed microsatellite alleles that were not identified from St Bees Island koalas, indicating that it is most unlikely that these populations were established by a sole secondary introduction from St Bees Island. Mitochondrial haplotypes on the central Queensland islands were more similar to a haplotype found at Springsure in central Queensland and the inland clades in south-east Queensland, rather than the coastal clade in south-east Queensland.