Australian medical education has not kept pace with Australia's increasingly multicultural society. Feedback from ethnic community organizations suggests that medical students and specialist trainees in medicine are not learning how to understand, to interact with and to treat patients in culturally appropriate ways. The first part of this paper reviews the problem and considers some perspectives in transcultural medicine and clinically applied medical anthropology. The second part proposes some areas in which medical schools can take the initiative in developing interdisciplinary teaching programmes at undergraduate and graduate levels. These programmes should provide minimal standards to enable any medical graduate to practices with patients of any cultural background and, in addition, will encourage some students to pursue more specialized studies in transcultural medicine and medical anthropology. It is suggested that new developments should be integrated with appropriate university departments such as anthropology.