A relatively new technology of treating oil spills in marine and inland environments is bioremediation. This technique is based on the break down of the petroleum hydrocarbons to biomass and carbon dioxide by indigenous microorganisms, which are encountered in all types of environments, terrestrial and aquatic. The biodegradation of any organic compound is limited by nutrients, most important of which are nitrogen and phosphorous. Also, the availability of adequate supply of oxygen is of critical importance, as is the moisture content. Appropriate pH levels, temperatures and freedom from toxic or inhibiting substances are important in the rate of bioremediation. The rate of biodegradation may also be enhanced through seeding, which is the inoculation of the contaminated soil with specially adapted microbial communities, especially if applied in conjunction with nutrients. The two types of bioremediation, in situ and engineered aboveground treatment cell, are both cheap and effective methods of treating oil-contaminated sediments. However, the engineered treatment cell provides a more expensive but more effective and well controlled method of decontamination, compared to the in situ technique. Generally, bioremediation is a promising oil cleanup method still under development, with variable effectiveness, depending on the site environmental conditions. Finally, its applicability in the Cooper and Eromanga and Otway basins is considered to be favoured by the environmental conditions of these areas.