The town of Rabaul, on the Gazelle Peninsula in East New Britain, was the commercial center, and after 1910 the administrative headquarters, of German New Guinea. It remained the headquarters of the Australian military Administration and the Australian Mandated Territory of New Guinea. Matupi volcano, on Vulcan island in Rabaul harbor, erupted in 1937. Several hundred people were killed and the town extensively damaged. It was decided that the headquarters of the Mandated Territory Administration should be moved to Lae, but the move had not been completed when Rabaul was occupied by the Japanese in 1942. The Japanese established a major military base in Rabaul, and it was much damaged by American and Australian bombing raids. After the war, Port Moresby became the administrative headquarters for the Territory of Papua and New Guinea.

The postwar rebuilding of Rabaul was largely the work of business interests: Australians and members of the local Chinese community. Rabaul’s commercial importance has been as a port for the export of cocoa and copra from the fertile Gazelle Peninsula. Most Germans were deported after World War I, and the expatriate population was mainly Australian with a small Chinese trading community of descendants of plantation laborers brought in by the Germans. The local people are mainly Tolai and their language is the dominant local language. The population rose from 14,954 in 1989 to 16,883 in 1993.

See also: Rabaul Strike