Melbourne is still expected to overtake Sydney as the largest Australian city despite many fleeing Victoria's capital during the pandemic.
Government population figures show Melbourne's population shrinking by 1.6 per cent in 2020/21 as 18,000 left the state.
Melburnians endured some of the world's longest lockdowns during the COVID-19 pandemic, prompting many to move interstate or to country Victoria.
Despite its population shrinking more than any other city, Melbourne's population growth is expected to rebound to 2.1 per cent in 2023/24 and surpass Sydney as the biggest city by 2031/33.
Queensland absorbed much of the interstate migration throughout the pandemic and actually grew by 0.8 per cent in 2020/21 despite the slowdown in overseas migration caused by travel restrictions.
The Centre for Population sees this trend continuing as the warmer climate state continues to entice people from other parts of the country.
Extracts from the population report, which is due to be released in full on Friday, revealed the impact of minimal overseas migration on Australia's projected population growth.
Although the temporary slowdown in migration has wiped almost a million people from Australia's 10-year forecast, the population is still expected to close in on 30 million by 2032/33.