During the Martial Law period (1972-1986), the Philippines was on the receiving end of aid provided by Australian aid among other international financial institutions aimed to alleviate poverty and foster development in the Third World. Existing scholarship on Australian and Philippine relations during this period largely revolve around the latter’s strategic location for regional trade and the presence of United States (US) military bases. This study aims to look at the impact of Australian aid concerning the human rights situation in the Philippines during Martial Law. In the spirit of international cooperation and regional stability, Australia funded humanitarian projects such as integrated rural development projects in Zamboanga del Sur and Northern Samar. This study takes off from Walden Bello’s work, “Development Debacle: The World Bank in the Philippines” that discusses disasters brought about by foreign aid. It first gives a general overview of the Australian-Philippine aid during the period and some of the projects that were funded as a result. It then focuses on how Australian aid impacted the militarization of the countryside and the repression of human rights in the Philippines, drawing on specific incidents such as the Sag-od Massacre of Northern Samar, and the trial of Australian priest Fr. Brian Gore.