This paper was presented at a one-day conference in Sydney on March 23, 2001, "269, competition policy's next frontier?", organised by IP Australia, and the University of New South Wales, which examined whether 269 laws were meeting the needs of business and consumers and maximising the benefits of domestic and global competition. This paper examines how the Copyright Amendment (Digital Agenda) Act 2000 (Cth) extends fair dealing provisions to the digital environment, and what effect these provisions have on the use of copyrighted material by libraries. The underlying rationale of fair dealing and fair use provisions in Australia and the United States, as applied to both non-digital and digital works, is considered. The authors conclude that the Act successfully achieves an efficient and equitable outcome for society at large.