The aim of this article was to quantify socioeconomic inequalities in dental caries experience among Australian children and to identify factors that explain area-level socioeconomic inequalities in children's dental caries. We used data from the National Child Oral Health Survey conducted in Australia between 2012 and 2014 (n = 24,664). Absolute and relative indices of socioeconomic inequalities in the dental caries experience in primary and permanent dentition (decayed, missing, and filled surfaces [dmfs] and DMFS, respectively) were estimated. In the first stage, we conducted multilevel negative binomial regressions to test the association between area-level Index of Relative Socioeconomic Advantage and Disadvantage (IRSAD) and dental caries experience (dmfs for 5- to 8-y-olds and DMFS for 9- to 14-y-olds) after adjustment for water fluoridation status, sociodemographics, oral health behaviors, pattern of dental visits, and sugar consumption. In the second stage, we performed Blinder-Oaxaca and Neumark decomposition analyses to identify factors that explain most of the area-level socioeconomic inequalities in dental caries. Children had a mean dmfs of 3.14 and a mean DMFS of 0.98 surfaces. Children living in the most disadvantaged and intermediately disadvantaged areas had 1.96 (95% confidence interval, 1.69-2.27) and 1.45 (1.26-1.68) times higher mean dmfs and 1.53 (1.36-1.72) and 1.43 (1.27-1.60) times higher mean DMFS than those living in the most advantaged areas, respectively. Water fluoridation status (33.6%), sugar consumption (22.1%), parental educational level (14.2%), and dental visit patterns (12.7%) were the main factors explaining area-level socioeconomic inequalities in dental caries in permanent dentition. Among all the factors considered, the factors that contributed most in explaining inequalities in primary dental caries were dental visits (30.3%), sugar consumption (20.7%), household income (20.0%), and water fluoridation status (15.9%). The inverse area-level socioeconomic inequality in dental caries was mainly explained by modifiable risk factors, such as lack of fluoridated water, high sugar consumption, and an unfavorable pattern of dental visits.