The announcement represents a humiliating climbdown for John Howard and follows a referendum last Saturday in which nearly 55 per cent of Australians voted to remain a constitutional monarchy rather than become a republic.
Although Rule 69 of the Olympic Charter states unambiguously that the Games should be opened by a host country's head of state, Mr Howard has for years maintained that the role should be performed by the head of government - in other words, him. Since the referendum, the conservative Prime Minister, one of Australia's few remaining monarchists, has faced mounting pressure to step aside.
Although the outcome of the referendum was not a vote of confidence for the monarchy, but instead reflected splits among republicans, it has made Mr Howard's position on the Olympics indefensible. Heblamed his U-turn on his political foes in the Australian Labor Party, saying that they were trying to turn the opening ceremony next September into a political issue.
He said he would propose to the Sydney Organising Committee for the Olympic Games that it invites the Governor-General, Sir William Deane, to open the 2000 Games.
He would advise the Queen of his views on the matter at the Commonwealth Heads of Government meeting in Durban, South Africa, later this month.
Some critics had accused Mr Howard of seeking to secure a place in history by associating himself with Australia's sporting achievements on home turf.
Others had said his stance was an acknowledgement that pro-republican Australians would not countenance the spectacle of a foreign monarch presiding over a showcase event for the nation.
As one sports commentator wrote: "Stone the crows and tie our kangaroo down, sport! It's just not on. With due respect ... to Her Majesty, the thought of her opening our Olympics is simply unthinkable, the most unheard- of thing most of us have ever heard of."