Tasmanians can now apply to have historic convictions for homosexual acts removed from their criminal records.
The move is being celebrated by rights groups, who say the process has helped transform the state, the last one in Australia to decriminalise homosexuality.
"There's a lot of pessimism in the world today about whether social change is possible, whether we can actually change things for the better. And, if there's one word that proves that we can, that things can get better, that word is 'Tasmania'," Tasmanian Gay and Lesbian Rights Group spokesman Rodney Croome said.
Tasmania became the last Australian state to decriminalise homosexuality in 1997, but it has taken more than 20 years for the convictions under those laws to be addressed.
Mr Croome, who was in the forefront of the often acrimonious decriminalisation struggle, said the state has been transformed.
"Clearly, Tasmania has become a far more tolerant and inclusive and happier society, I think, over the last couple of decades because of the way that Tasmanians have gone from rejecting LGBTI (lesbian, gay, bisexual, transgender and intersex) people to embracing us and I think that's an important story for not just the nation, but the world, to hear," he said.
Rights groups praised the leadership of Premier Will Hodgman's Liberal government in seeing through the reforms.
Former Tasmanian anti-discrimination commissioner Robin Banks was involved in the drafting and progression of the new laws through the state's parliament.
She said the latest development represents what has been a major change in attitudes towards the LGBTIQ community in Tasmania.
"We went from being very much behind the eight ball, in terms of attitudes to homosexuality, to, I think, probably the most progressive state, when it comes to our response to homosexuality and to transgender issues. And I think that's a real testament to everybody who's been involved in the debate, particularly from the (LGBTIQ) community, reaching across what was a very wide divide," Ms Banks explained.
She said the anti-homosexuality laws, which included outlawing men wearing dresses in the street, should never have existed.
"It doesn't hurt anybody. It was a victimless crime, and that's a really important thing to remember. And it wasn't a crime all over the world. It was particularly in common-law countries, so the countries that came out of England (the British empire), where we've had this history of criminalising homosexuality.
“I really ask people to think, 'Well, what difference does it make to you if somebody loves a person of the same gender as themself?'"
The Human Rights Law Centre's Lee Carnie said acknowledging the injustice of Tasmania's old laws will have a practical impact on the lives of people convicted under them.
But she said people in Western Australia and the Northern Territory still can't have historic convictions for homosexual acts removed from their criminal records.
"That can still be on a criminal record, and that can mean that, for example, if you're applying for a visa to go to the United States and they ask if you've ever been charged with a crime, you have to tell them about the fact that you were charged with a crime - you know, sodomy or carnal knowledge or gross indecency, these charges which are sex offences, which are taken very seriously by overseas authorities. And they have to explain that," she said.
Ms Banks said Tasmania's changes will allow some people to put the upheaval of that time in their lives behind them.
But she said, for others, it comes too late.
"People have left the state and left Australia, and, you know, sadly, some people have taken their own lives, because of the effect of the criminalisation of homosexuality. And so it means, for the people who are still with us, a recognition that their lives should never have been harmed in that way. And that's a pretty enormously big thing."