The great majority of dendroclimatological work in Australia has thus far relied on ring-width chronologies only. We report novel results from a pilot study that show the potential to develop density-based climatically sensitive chronologies from two long-lived conifers endemic to Tasmania: Pencil Pine and Celery Top Pine. Cross-dating of average ring density profiles within each of the two sites examined was comparable with the better replicated ring-width chronologies from the sites. Cross-dating potential for maximum density was also indicated. Correlations between density and climate for both species were stronger and more persistent across a window of several months than correlations between ring width and climate. These stronger correlations suggest that temperature reconstructions based on average density may be possible. The ability to develop high resolution temperature-sensitive chronologies would allow for spatial comparisons across regions such as Tasmania that are affected by multiple broad-scale climate systems. A particularly novel result was the finding that maximum density was significantly related to stream-flow at the end of the growing season. Further work is required to assess the potential to reconstruct temperature, and to reconstruct stream-flow for important Tasmanian catchments over the past 500-800 years.