The 23-year-old lost her family home to bushfire in 2003 and tasted a bitter Olympic defeat in 2012, but with each setback she has bounced back stronger.

Out of the ashes of the bushfire, Stromlo Forest Park mountain bike facility was born, the place where Buchanan won her first world title.

At the 2012 Olympic Games she was the short-priced favourite for gold in the BMX final, but a botched start saw her finish fifth.

Not to be deterred, Buchanan went on to be crowned world champion in two cycling disciplines the following year, a feat leading to her also being named Australian cyclist of the year.

''I think part of me being chosen to be Australia Day ambassador for the ACT is living out what it means to be Australian,'' she said. ''Canberra has given me the platform to be successful … achieve my dreams, represent Australia and fly the flag.''

She will spend the weekend attending all the major events, helping cook the Sunday sausage sizzle, welcoming new citizens with gifts, and spruiking her home town.

''We're a city that punches well above our weight with so many people doing successful things and achieving so much. I'm very proud.''

Buchanan is looking to inspire the next generation of high achievers, too; next week she will launch her mentoring program for girls following the BMX path she forged.

''I've got huge passion for supporting the future of women,'' she said. ''One thing that I've noticed in my sports - BMX and mountain biking - they're both heavily male dominated, and being a female you do have those struggles and that adversity you've got to overcome.

''I want to help them … rise above that and achieve their goals.''