Students, professionals and people who speak a language other than English are also more likely to deploy generative AI tools, while those aged over 65 and First Nations people are less likely to use the tech.
Researchers revealed the findings in the 2025 Australian Digital Inclusion Index on Wednesday, which also found the nation had become more digitally connected since 2023, even though significant gaps remained.
The report comes after the National AI Centre released revised voluntary guidelines for the technology, and after the federal government promised to release a national AI plan before the end of 2025.
Researchers from RMIT, Swinburne University and Telstra created the index based on a survey of more than 3000 Australians, as well as two surveys of 2800 First Nations people.
They found Australians' access to digital technology had improved by 4.8 points since 2023 but significant gaps remained, with one in five people excluded from technology.
Older Australians, those on lower incomes and people with lower levels of education were among the most likely to be excluded from technology, the index found, and geography also played a role.
Australians living in capital cities were more likely to have access to digital technology than those in other parts of the nation, Swinburne Professor Anthony McCosker said, which could put many people at a disadvantage.
"It's more than just an inconvenience - digital exclusion cuts people off from vital services and opportunities in education, work and health," he said.
Tasmania ranked the lowest for digital ability, affordability and access in the index with 69.4 points, although South Australia, the Northern Territory and Queensland also ranked below the national average.
The ACT scored highest on the index, with 79.5 points, followed by Victoria, NSW and Western Australia.
Questions about generative AI technology were introduced to the study this year, and almost half of all respondents reported using the technology (45 per cent).
Younger participants were most likely to use AI regularly, with 69 per cent of people aged between 18 and 34 using generative AI tools, while use dipped to 15 per cent for people aged between 65 and 74 years, and 10 per cent for people over 75.
Students were among the most prolific AI users (78 per cent), as well as professionals (67 per cent), and people who spoke a language other than English (58 per cent).
People with a disability and First Nations people were less likely to use AI tools even though they could benefit from it, RMIT University Distinguished Professor Julian Thomas said.
"Gen AI has the potential to deliver significant benefits for everyone but its impact will be greatest if it's implemented fairly and no one is left behind in the digital transformation," he said.
The report issued five recommendations to close digital gaps, including concessional broadband access for low-income households and training programs to boost digital skills.
