I take it you mean pre-European settlement. Yes, boats were widely used by most coastal, river and lakeside communities. Primary sources are the many canoe trees still existent, settler testimonies, and oral histories.
http://australianmuseum.net.au/Indigenous-bark-canoe-from-New-South-Wales
Though over 100-years-old at this point, N.W. Thomas' Australian Canoes and Rafts is a nice little introduction to the topic, drawing from contemporary and historical sources of his day. It's also a product of its era, with talk of "civilised" vs "uncivilised" peoples and an woefully incomplete view of archaeology. Not that we have a complete picture by any means, but after a century Australian archaeologists have learned a thing or two. For example, Thomas begins by saying that Aboriginal Australians never reached Kangaroo Island, but we now know there was a lengthy Aboriginal occupation of the island which had come to an end before Europeans began to settle the continent (though mainland peoples knew of the island and may have made visits to it after the permanent occupation ended).
The most detailed information about and extensive use of Australian watercraft comes the Top End and northern Queensland (though I don't want to create the impression that boats, or even certain type of boats, were exclusive to these regions). The Yolngu in Arnhem Land (the eastern portion of the Top End) famously employed bark canoes, the traditional construction methods of which you can see in the 2006 film Ten Canoes. Before European contact, the Yolngu participated in the trepang trade with Makassans from Indonesia (here's a image from the mid-1800s of a trepanger operation in northern Australia, a tradition that continued until the colonial Australian government outlawed the trade in 1906. Historically, a few Yolngu traveled back to Makassar and may have done so before Europeans arrived as well.
In Queensland, particularly the Torres Strait Island, there were outrigger canoes, often with sails woven of leaves. The Torres Strait Islanders are Melanesian, not Aboriginal Australians, but their Aboriginal neighbors to the south picked up this model of watercraft from them. Outriggers plied up and down the coast of Queensland (here's a small sail-less version from the vicinity of Cairns), equally at home on the Barron River as well as the sea. Outriggers also spread westward into the Top End, at least as far as the vicinity of Darwin.
