The team of 410 is the lowest since Barcelona in 1992 and well down on the 632 who took part on home soil at the 2000 Olympics in Sydney.
Australia collected 14 golds at the 2008 Games in Beijing and 46 medals overall, behind China and the United States, as well as Russia and Britain.
In London, it will again be relying on its swimmers to bolster the medal tally with swimming head coach Leigh Nugent targeting at least a dozen medals from a 47-strong squad led by 100m freestyle world champion James Magnussen.
Cycling is another discipline where Australia expects to win medals, with Cadel Evans joining his teammates soon after attempting to defend his Tour de France title. He is currently second behind Britain's Bradley Wiggins.
Stuart O'Grady is also on the cycling team and will be appearing at his sixth Olympics.
Shooters Michael Diamond and Russell Mark will also be at their sixth Games, while equestrian Andrew Hoy will make a seventh appearance.
The most medalled Olympian on the team is swimmer Leisel Jones, who is hoping to add to the three golds, four silvers and one bronze she has won so far.