Trooper Mark Donaldson, 29, received the VC, the highest military honour in the Commonwealth, at a ceremony attended by Prime Minister Kevin Rudd at Government House in Canberra.

Only three other VCs have been awarded worldwide in the past 27 years, and Donaldson was the first person ever to receive the award in its national form, the Victoria Cross for Australia, which was introduced in 1991.

Rudd said Donaldson deliberately drew enemy fire away from his wounded comrades during a prolonged ambush of combined Australian, US and Afghan troops in Uruzgan province on September 2 last year.

Nine Australians were injured in the battle -- the nation's worst combat casualty toll in a single incident since the Vietnam War -- when their convoy came under heavy fire from Taliban militants.

Showing complete disregard for his own safety, on his own initiative and alone, Donaldson ran 80 metres across exposed ground to rescue an injured coalition forces translator and carry him to safety, the medal citation said.

"This was courage writ large," Rudd told senior military officers, members of Donaldson's family and invited guests after Governor-General Quentin Bryce presented the medal to the trooper.

"During an early stage of the enemy ambush he deliberately exposed himself to enemy fire in order to draw attention to himself and thus away from wounded soliders.

"This selfless act alone brought enough time for those wounded to be moved to relative safety."

Describing the daring rescue of the interpreter, Rudd said: "His feat under fire now becomes the stuff of Australian legend."

The prime minister withdrew Australian forces from Iraq after coming to power in November 2007 but has pledged to keep them in Afghanistan.

He noted that an Australian soldier had been killed there earlier this month, adding: "He is one of too many who have done the same, fighting for the values for which Australia stands in the distant mountains of Afghanistan.

"Many others still have been wounded and I am fearful that there will be more."

Eight Australian soldiers have been killed in Afghanistan, where Canberra has about 1,000 troops serving with international forces helping the Afghan government fight Taliban rebels.

Donaldson, who is married and has one daughter, said the award was a great honour but it would not change him.

"I don't see myself as a hero, honestly. I still see myself as a soldier first and foremost," the special services trooper told reporters after the ceremony.

A total of 96 Australians have been awarded the VC, with the last recipient earning the top award for valour during the Vietnam War.

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