Upon her return to Melbourne, she enrolled at Australia's prestigious National Institute of Dramatic Art. After graduation she joined the Sydney Theatre Company's production of Caryl Churchill's "Top Girls", then played Felice Bauer, the bride in Timothy Daly's musical "Kafka Dances". She won the Newcomer Award from the Sydney Theatre Critics Circle for her performance. From there, Cate went on to star as Carol opposite Geoffrey Rush in David Mamet's searing polemic, "Oleanna", also for The Sydney Theatre Company. Consequently, she achieved an unprecendented feat, picking up her second gong of the year by also winning the Rosemont Best Actress Award. In 1995, she was nominated for Best Female Performance for her turn as Ophelia in the Belvoir Street Theatre Company's production of "Hamlet". Her other theatre credits include Helen in the Sydney Theatre Company's "Sweet Phoebe", Miranda in "The Tempest", and Rose in "The Blind Giant Is Dancing", both for the Belvoir Street Theatre Company. Later, like "Oscar and Lucinda" co-star, Ralph Fiennes, she moved on to Chekov, playing Nina in "The Seagull".

In the realm of television, Cate co-starred in ABC (Australian Broadcasting Company) Televsion's "Heartland", winning critical acclaim in this examination of rural aborigines. She also earned notice as Bianca in ABC's "Bordertown", as Janie Morris in "G.P.", and in ABC's popular series, "Police Rescue". Cate revised her character of Rosie from "Heartland" in the non-feature film, Parklands. She made her feature debut as a shy Australian nurse in Bruce Beresford's, Paradise Road. She next starred in Cherie Nowlan's debut feature, Thank God He Met Lizzie, playing the title role. For this, Cate won the prestigious AFI (Australian Fim Institute) Best Supporting Actress Award. Cate's next venture was the critically acclaimed, Oscar and Lucinda, directed by noted Australian director, Gillian Armstrong. Cate captivated audiences and critics alike, playing opposite Ralph Fiennes, with her bewitching and mesmerizing portrait of Lucinda Leplastrier.

In June of 1997, she married Andrew Upton, a script and cointinuity editor she had met on the Parklands shoot. It was Cate's starmaking portrayal of Queen Elizabeth I in Shekhar Kapur's Elizabeth that shot her into the stratosphere in terms of both popular and critical acclaim. Cate's chameleonlike qualities astounded both the industry and the public. As a result of Elizabeth, Cate was honored with many awards for her performance. Blanchett went on to star with Angelina Jolie, John Cusack, and Billy Bob Thornton in the Mike Newell comedy Pushing Tin (1999). Although the film got a lukewarm response, Blanchett was praised for her performance as a Long Island housewife. The same year, she played another housewife, albeit one of an entirely different stripe, in Oliver Parker's adaptation of Oscar Wilde's An Ideal Husband. Despite a uniformly strong cast including Jeremy Northam, Rupert Everett, and Julianne Moore, the film received very mixed reviews, although, as was usually the case, Blanchett won praise for her contribution to it.