The purposes of this study were to analyse trends in hip fracture (HF) epidemiology over a 13-year period (1994-2007) in the Australian Capital Territory (ACT), to assess the potential impact of concurrent changes in hormone replacement therapy (HRT) and bisphosphonate use and to present a new prediction of HFs in Australia up to 2021. Annual sex- and age-specific incidence rates (per 100,000 population) were determined and standardized using the Australian 2006 population. The projected number of HFs was estimated by two models applying age- and sex-specific HF rates averaged for 2002-2006 (model 1) or continuously changing as observed in this period (model 2, Poisson regression) to the projected population. In 2006 compared to 2001, the population > or = 60 years in the ACT increased by 19.7%. Over the last 5 years the average annual incidence HF rate compared to the previous 3-year period decreased in females > or = 60 years of age by 28.3%. Between 2001 and 2006 the number of prescriptions for HRT dispensed in the ACT declined by 54.6, while the number of prescriptions for bisphosphonate increased by 245%, accompanied by a decline in standardized incidence of HF rates of 36.4%, mainly in women (42.1%). This represents an annual cost for bisphosphonates per one prevented HF, of $A45,250 or $A576 person/year. Compared to 2006 the total number of HFs in Australia according to model 1 will increase in 2011 by 20.1% and in 2021 by 58.8%, but according to model 2 will decrease by 15.5% in 2011 and 27.5% in 2021. Our data suggest that the previously predicted rising trend in HFs in elderly women reversed, but did not so for men. This was coincident with a significant fall in HRT use and increased prescribing of bisphosphonates, which is cost-effective. However caution should be used in attributing causation as this is an ecological study. If trends in HF observed in 2002-2006 continue, the absolute number of HFs in Australia in 2011-2021 will stabilise or decline (which is more likely), despite the rapid ageing of the population.