Using specially generated tabulations of Muslim and non-Muslim Australians from the 2006 Census, this paper examines the social and economic position of Muslims in Australia and implications for their social inclusion. Although Australian Muslims come from more than 130 countries, the largest number, 38%, are Australian-born and almost 40% are younger than 20 years of age. Educationally they are high-achievers but on all indicators of socioeconomic well-being they fall into a very disadvantaged category. Twenty-one% of adult Muslim men have a university degree compared with 15% of non-Muslim Australians, yet their age-specific unemployment rates are two to four times higher than those of non-Muslim Australian; their rate of home ownership is half the national average; 40% of Muslim children are living in poverty and only 25% of Muslim households have above-average household. Thus, a significant proportion of Muslim Australians occupy a relatively marginal position both socially and economically in Australian society. This marginalisation fosters intergenerational transfer of disadvantage and may also contribute to their alienation from Australian society and its values which makes them vulnerable to religious and non-religious radicalism. The paper will argue that socioeconomic marginalisation and a sense of relative deprivation are often breeding grounds for religious and non-religious radicalisation. Theological and ideological impulses only further galvanise those who are socially and economically disadvantaged.