Objective: to examine the key determinants of pharmaco-epidemiology in Australian nursing homes. Design: a cross-sectional survey of medication use in 998 residents in 15 nursing homes in Southern Queensland and Northern New South Wales. Results: the total, laxative, digoxin/diuretic, benzodiazepine and psycholeptic medication prescribed and administered to residents of nursing homes was affected to differing extents by age and gender, the nursing home, resident functional disability and medical practitioner. Resident Classification instrument (RCI) category and nursing home were the dominant determinants for prescribing and administration of the total drugs, laxative, benzodiazepine and psycholeptic medications. In contrast, the resident use of digoxin and/or diuretics was dependent on the resident age and on the functional disability (RCI category) of the resident but not medical practitioner or nursing home. Approximately 30% of medications were prescribed on a pro re nata (p.r.n.) basis and administered at the discretion of registered nurses. Conclusion: nursing home culture is a major determinant of the variability in medication use between residents, particularly for those medications often prescribed for p.r.n. use. The nursing home does not account for variation in the use of digoxin and/or diuretics which are prescribed on a non-discretionary basis.