This paper compared the effect of life change in adjustment of overseas students with those of Australian students. 342 students were divided into 4 experimental groups. There were: Overseas students with residence of less than one year (OV1 group, N = 44), overseas students with residence of more than one year (OV2 group, N = 81), Australian students raised in Brisbane (A3, N = 105) and Australian students raised outside Brisbane (A4, N = 112). The result of discriminate analysis showed that overseas students (OV2) were significantly more likely to experience moderate to severe clinical depression and loneliness than the Australian students. Age and expectation of difficulty in study were the best predictors for depression in overseas students.