Cryptococcus neoformans var. gattii has been shown to have a strong association with eucalypts frequently used by koalas and, not surprisingly, it has been shown to colonize the nasal cavities of koalas. The progression from nasal colonization to tissue invasion is critical to understanding the pathogenesis of cryptococcosis in this species and provides a model for pathogenesis of cryptococcosis in other species. Cryptococcal antigenaemia was detected in twenty-eight healthy koalas from three different regions. This was interpreted as representing limited subclinical disease. One koala developed cryptococcal pneumonia 6 months after leaving the study, whereas another developed cryptococcal meningoencephalitis during the course of the study. Opportunistic necropsies on ten antigen-positive koalas resulted in discovery of small cryptococcal lesions in two (paranasal sinus and lung, respectively). Our data suggest that cryptococcal antigenaemia occurs commonly in koalas, especially in areas with a high environmental presence of C. n. var. gattii. Subclinical disease appears most likely to manifest as a small focal lesion in the respiratory tract. Possible outcomes include elimination by an effective immune response, quiescence with possibility of later re-activation or direct progression to overt disease. Symptomatic and subclinical cases showed differences in levels of antigenaemia. The data presented have significant implications for koalas in captivity.