Draped in medals, the Olympic team received a heroes' welcome, greeted by Prime Minister Kevin Rudd and hundreds of family and friends.

Euphoria, exhaustion and relief were visible on the faces of the athletes as they shared laughs, hugs and tears, and enjoyed the reunion.

Most of the 435 Olympians, who won 46 medals between them, arrived home after finishing sixth in the medal tally, as gauged by the number of golds won. Later in Brisbane, about 200 family members and well-wishers welcomed home Queensland Olympians.

Oarsman and opening ceremony flag-bearer James Tomkins, returning from his sixth Olympics, said the team was ''pumped'' to be back in Australia. ''The support that we got from Australia was incredible, the messages of support to all the athletes were unbelievable. Then to come back here and realise the enormity of the achievement of the team was absolutely phenomenal.''

Mr Rudd said the preparations for the 2012 London Olympics would begin straightaway.

''Every man, woman and child in this nation Australia is proud of every one of you, well done,'' he told the athletes.

Mr Rudd said he would look at the merits of introducing a national sports lottery to raise more money for Australian sport.

A few hours later, Stephanie Rice scotched rumours of a romance with US swimmer Michael Phelps.

Rice was appearing with Olympic medallist and her former boyfriend, Eamon Sullivan, at an underwear show.

Sullivan denied reports they would be getting back together. AAP