The inaugural State of Australia's Children report provides a snapshot of the nation's children and teenagers, collating more than 100 data sets and input from at least 2000 children across Australia.
Many of those surveyed reported declining life satisfaction as they grew older and less than a third of teens said they felt excited and hopeful about the next five years.
Anxieties about the future are most acute among 16 and 17-year-olds, with almost half citing financial security and housing as the greatest concerns facing their generation.
More than 40 per cent said making housing more affordable would be their top priority if they were to lead the country.
Teenagers also want adults to understand their worries about the future and job security.
Mental health was the second biggest concern for 39 per cent of those aged 12 to 17, followed by digital change and online safety.
The landmark report was developed by UNICEF Australia in partnership with the Australian Research Alliance for Children and Youth (ARACY) and supported by Minderoo Foundation.
Australia is at a crossroads when it comes to the wellbeing of children, UNICEF Australia's chief advocate for children Nicole Breeze told AAP.
"When you look right across this report, you can see that life is getting harder for kids, particularly those who are already experiencing challenges," she said.
"Exposure to digital and online risks and harmful content are putting pressure on kids across Australia."
Just 53 per cent of kids are arriving at school developmentally on track across all five domains measured by the Australian Early Development Census.
For Aboriginal and Torres Strait Islander children, that figure drops sharply to just 34 per cent.
Systemic inequalities including poverty, intergenerational trauma and racism mean children in the most at-risk groups continue to fall behind.
Aboriginal and Torres Strait Islander children, children with a disability, children from lower socio-economic backgrounds and young people with experiences of out-of-home care are less likely to have what they need to grow and thrive.
"Australia has got all the conditions in place to make sure every child is supported to thrive," Ms Breeze said.
"Every child deserves the same outcomes, no matter where they live."
Minderoo Foundation's Cost of Late Intervention report released in August found the cost of failing to identify health and development issues in young Australians had surged almost 50 per cent to $22.3 billion annually.
"The science is unequivocal: the first five years shape a lifetime," Minderoo Foundation founder Nicola Forrest said.
"These years are a fleeting window, yet too many children start school without the foundations they need."
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