Aim Climatic fluctuations during the Pleistocene have shaped the population structure of many extant taxa. However, few studies have examined widespread species inhabiting the Australian continent, where periods of increased aridity characterized the Pleistocene. Here we investigate the phylogeography and population history of a widespread and vagile southern Australian marsupial, the western grey kangaroo (Macropus fuliginosus). Location Southern Australia. Methods We examined the variation of the mitochondrial DNA (mtDNA) control region from 511 individuals of M. fuliginosus sampled throughout their transcontinental distribution. Maximum likelihood and Bayesian analyses were used to investigate the phylogeography and coalescence analyses were then used to test hypothesized biogeographical scenarios. Results The combined results of the phylogeographical and coalescence analyses revealed a complex evolutionary history. Macropus fuliginosus originated in the south-west of the continent, with north-western and south-western populations subsequently diverging as a result of vicariance events during the mid-Pleistocene. Subsequent arid phases affected these populations differently. In the north-west, the expansion and contraction of the arid zone resulted in repeated vicariance events and multiple divergent north-western mtDNA subclades. In contrast, the south-western population was less impacted by climatic oscillations but gave rise to a major transcontinental eastward expansion. Main conclusions Macropus fuliginosus exhibits the genetic signature of divergence due to unidentified barriers in south-western Western Australia, while previously identified barriers across southern Australia appear to have had little impact despite evidence of a broad-scale range expansion prior to the Last Glacial Maximum (LGM). This pattern of localized expansion and contraction is comparable to unglaciated regions in both the Northern and Southern Hemispheres. Furthermore, this study indicates that despite the potential similarities between Northern Hemisphere glaciation and the activation of dune systems in the Australian arid zone, both of which rendered large areas inhospitable, the biotic responses and resultant phylogeographical signatures are dissimilar. Whereas a limited number of major geographically concordant refugia are observed in glaciated areas, the Southern Hemisphere arid zone appears to be associated with multiple species-specific idiosyncratic refugia.