The sugar glider (Petaurus breviceps) shows considerable variation in external morphology and mitochondrial DNA (mtDNA) diversity across its distribution in New Guinea and Australia. Here we investigate the phylogeography of P. breviceps in Australia using data from two mitochondrial genes (ND2 and ND4) and a nuclear gene (ω-globin). Phylogenetic analyses revealed the existence of two divergent mtDNA clades that are distributed over distinct geographical regions, one from coastal New South Wales and south-eastern Queensland and a second over the remaining distributional range of the species in Australia. The two groups generally had distinct ω-globin haplotypes that differed by one or two mutational steps. Analyses of Molecular Variation further supported the presence of at least two populations, accounting for 84.8% of the total mtDNA variation and 44% of the ω-globin variation. The general concordance of phylogeographic and population analyses suggests that population subdivision, possibly resulting from the combined influences of aridification after the Pliocene and uplift of the Great Dividing Range has impacted the evolution of P. breviceps. Our results also show that the geographical distribution of the two evolutionary lineages does not correspond with the distribution of the current morphological subspecies and we further propose that they be considered as separate Evolutionarily Significant Units for the purposes of conservation management.