The Southern Highlands of New South Wales between Goulburn and Moss Vale have long been known to contain scattered deposits of bauxite associated with Paleogene basalts. They are currently the subject of an exploration licence held by Australian Bauxite Ltd. Mostly the bauxites overlie the basalt or unconsolidated sub-basaltic Paleogene sediments. Most previous studies suggest the bauxites are formed by in situ weathering of the basalt. This study shows that all the bauxite deposits occur unconformably above pisolithic basalt, Paleogene sediments or weathered Paleozoic rocks, and that they contain materials only formed at or near the surface including poorly diffracting materials and maghemite. Most also contain significant quartz. Most bauxites also show signs that they have been chemically active over a long period with abundant gibbsite cements, pseudomorphs and void fillings as well as abundant hematite and goethite. These bauxites, like those at Weipa, are formed by the erosion, transport and deposition of bauxitic pisoliths in valleys as the landscape evolved. The pisoliths are inferred to have originated from weathered basalt profiles and have been concentrated by reworking.