AUSTRALIAN scientists are set to explore everything from black holes to identifying alien life after jointly winning the bid to construct the world's largest telescope, the Square Kilometre Array.

Australia, New Zealand and South Africa have been jointly awarded the $2 billion project, which will involve the construction of a giant radio telescope consisting of thousands of separate radio dishes and other antennae.

When fully operational, it is expected to be 10,000 times faster than any telescope on the planet.

The announcement by the SKA Organisation brought an end to the countries' six year tussle over the project, which will be partly built in outback Western Australia at a site with the radio quietness needed to maximise its scientific potential.

Professor Matthew Colless, incoming director of the Research School of Astronomy and Astrophysics at the Australian National University, said the successful bid was a tribute to the work done by the radio astronomy groups in Australia.

''It's good to see that hard work has been rewarded,'' he said.

The good news came just months after Australia looked likely to lose its bid, when the key scientific panel known as the SKA Site Advisory panel recommended the project be awarded to South Africa in March.

At that time, the government had already spent more than $250 million on the bid.

Professor Colless said work would be carried out in several stages, with Australian scientists finalising work on the 36-dish radio telescope known as the SKA Pathfinder.

''That will do things like find where stars are forming nearby,'' he said. ''We can also do studies of transients, things that pop up and then disappear again.''

When completed, SKA will consist of more than 3000 antennae and will be so sensitive that it will be able to detect an aircraft radar 50 light years away.

The Australian Institute of Physics president Marc Duldig said the SKA would help scientists probe for places and conditions where life might have arisen elsewhere in the Universe, as well as investigate when the first black holes and stars appeared.

Dr Duldig said that each site would operate with different and complementary observational capabilities.

''In Australia wide-field receivers will be employed for large area surveys and low frequency phased arrays will look back to the time when stars and galaxies first started to form,'' he said.

''The decision builds on Australia's 77 years of leadership in radio astronomy, born in Australia and [Britain's] pioneering work on radar in World War II. Australian physicists were amongst the first to turn radar dishes to the stars. And that early work led to the dish at Parkes, to the Australia Telescope and to [Friday's] decision.''

Chief scientist Professor Ian Chubb said the project would ensure Australia remained at the forefront of radio astronomy.

''It is exciting that Australia will play such a prominent role in what is one of the largest international collaborations in science,'' he said.