Indonesian President Susilo Bambang Yudhoyono has received Australia's highest civilian honour during a ceremony at Government House in Canberra.
The rare award prompted a vow from the president to continue working on improving relations between the peoples of Indonesia and Australia.
Dr Yudhoyono, who began a three-day visit to Australia on Tuesday, was appointed an Honorary Companion in the General Division of the Order of Australia.
Governor-General Quentin Bryce placed the medal around the president's neck in front of dozens of ministers and journalists from the two nations.
The award was made in recognition of Dr Yudhoyono's work in strengthening Australia-Indonesia relations, and in promoting democracy and development.
The official citation said he had been "steadfast and humane" in the face of terrorist attacks, while also working with Australia through regional groups such as APEC and the East Asia Summit.
Ms Bryce congratulated Dr Yudhoyono for his "extraordinary contribution" to strengthening ties with Australia.
In response, the president said he was honoured to receive the medal. Dr Yudhoyono and Ms Bryce are lunching together before the president heads to the Australian War Memorial on Tuesday afternoon.
About 40 Indonesian journalists are following the president's every move during his visit to Australia.
"But they don't disturb the strength of the relationship."
President lays wreath at soldier's tomb
The president was shown around the Australian War Memorial in the afternoon, looking at the walls which bear the names of Australia's war dead.
He solemnly laid a wreath at a tomb as a bugler played the Last Post.
First Lady Ani Yudhoyono, Indonesian ministers and journalists joined the president in observing a minute's silence.
Denise McLennan, a tourist from Victoria who was at the war memorial, was surprised to see a head of state on her visit. She praised Dr Yudhoyono for laying a wreath.
"Because he realises that the world's still in conflict, for him to lay a wreath, I think that was special and moving," Mrs McLennan told AAP as she snapped photos of the departing president.
Yudhoyono to address parliament
Dr Yudhoyono will spend Tuesday evening preparing for his address to parliament on Wednesday.
On Wednesday, he will also have talks with Prime Minister Kevin Rudd and Opposition Leader Tony Abbott, before leaving for Sydney on Wednesday evening.
Security, terrorism and illegal fishing are all expected to be on the agenda.
Joint commitments on border protection are also likely to get a mention, especially given the latest two boats which arrived within 24 hours over the weekend.
Dr Yudhoyono is expected to approve a deal that will see Indonesia criminalise people smuggling.
Traditionally bumpy relations were last tested in October during a stand-off over a boat-load of asylum-seekers picked up by Australian authorities and taken to an Indonesian port.
In September, Australia opened a war-crimes investigation into the shooting of the "Balibo Five" journalists who were killed by Indonesian troops in East Timor in 1975.
The countries -- a sprawling Muslim-majority archipelago of 230 million, and a continent-sized island of 22 million -- have also been at odds over the "Bali Nine" Australian drug-smugglers, three of whom have been sentenced to death.
Yudhoyono, who will hold talks with Rudd on Wednesday, is also likely to discuss the fight against extremism after three Australians died in July's bomb attacks on two luxury Jakarta hotels.
Australia earlier lost 88 nationals in the 2002 Bali bombings, while nine people were killed in a car-bombing at its embassy in Jakarta in 2004.