It looks like British-born opposition leader Tony Abbott has overtaken PM Kevin Rudd in the polls with the election just two days away.
Gillard has been ousted in a political coup and replaced by the man she herself led a leadership challenge against exactly three years ago.
Australia's Prime Minister Julia Gillard has been pictured knitting a cuddly toy kangaroo for Prince William and Kate's baby.
Australians have gone to the national voting booths today with opinion polls pointing to a big defeat for the ruling Labor Party led by Prime Minister Kevin Rudd.
Mr Rudd returned to power on June 26 after his party dumped Julia Gillard, the country's first female prime minister, due to a prolonged slump in the polls.
Tony Abbott, who leads the conservative opposition, can take office if he wins just one extra seat in the parliament's 150-seat lower house.
Australian Prime Minister Kevin Rudd has called a general election for September 7, six weeks after he toppled former leader Julia Gillard.
Mr Rudd, who returned to power after being dumped by his centre-left party in June 2010, is expected to lose office despite enjoying a bounce of support after replacing Ms Gillard.
Conservative opposition leader Tony Abbott remains the favourite to win power.
Kevin Rudd has been sworn in as Australian Prime Minister, three years and three days after he was ousted from the same job in an internal government showdown. The leadership ballot was forced by party colleagues hoping to avoid a huge defeat in upcoming elections.
Residents of the small Welsh town where Julia Gillard was born have expressed their shock at her resignation. Gillard was born in Barry, in the Vale of Glamorgan in 1961 and the family moved to Adelaide, Australia after doctors advised the warmer climate would help her lung infection.
Vale of Glamorgan county councillor Ian Johnson said Ms Gillard was still popular in the town she was born.
"As a politician she's been very successful and has faced a lot of opposition from rivals - and it's clear that most of that opposition has been because of her gender and not her policies.
"But she has done a fantastic job and broken a glass ceiling in politics.
"Regardless of what you think about her politics she's been an inspiration - not just in Australia but also back here in Wales."
Former Foreign Secretary David Miliband welcomed the return of former Australian Prime Minister Kevin Rudd to the top job, saying he is "one of the sharpest brains in public life."
Kevin Rudd is one of the sharpest brains in public life. Good he gets the chance to finish what he started.
Kevin Rudd previously served as Prime Minister from 2007 to June 24 2010.
He had been popular, but was challenged to a leadership ballot by Julia Gillard, who was then his deputy. He did not contest the ballot when he became aware of Ms Gillard's support, and she became prime minister unopposed.
Rudd supporters have been accused of undermining Ms Gillard's leadership from the start and have been blamed for damaging leaks against her.
Those leaks partially derailed her 2010 election campaign - she led Labour to a narrow victory after forming an unpopular minority government with the support of independents and minor Greens party. Ms Gillard had survived two previous attempts by Mr Rudd to take over.
A Mandarin-speaking former Beijing diplomat turned state government bureaucrat, his leadership style endeared him to voters.
His first act as PM in 2007 was to sign the Kyoto protocol to limit carbon emissions and attempt to limit the impact of climate change. In February 2008 he apologised to Indigenous people for "the profound grief, suffering and loss" caused by party policies of the Australian parliament.
So the same people who voted Rudd out and replaced him with Gillard are voting Gillard out and Rudd in. Logic? #Australia
Kevin Rudd has spoken after he defeated Australian Prime Minister Julia Gillard in a Labor Party leadership vote 57-45.
Mr Rudd said: “I intend to lead a government that brings people together and gets the best out of them."
Explaining why he is taking on the challenge to be Prime Minister once more, he said:
"I simply do not have it in my nature to stand idly by and to allow an [Tony] Abbott government to come to power in this country by default.
"In 2007, the Australian people elected me to be their PM. That is a task that I resume today with humility, with honour, and with an important sense of energy and purpose."