By Dominic Hughes BBC correspondent in Sydney

This Bali bomb attack has come as an enormous shock to the Australian public, as friends and relatives of the hundreds of people visiting the Indonesian island anxiously wait for news.

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Australians are accustomed to viewing themselves as insulated from dangers faced elsewhere in the world by virtue of the country's remoteness.

But the Prime Minister John Howard, with his voice close to breaking, has warned that the country must now prepare itself for the worst.

"There are many Australians unaccounted for, many... We must therefore prepare ourselves as a nation for a significant number of Australian deaths," he said.

Opposition leader Simon Crean echoed the sentiments of many when he expressed his distress following news of the attack.

"I'm shocked and horrified at this outrageous and reckless killing of innocent people. It just goes to show how vulnerable people can be."

Emotional returns

Already some Bali tourists have returned to Sydney, where there were tearful reunions with anxious family members.

And local radio shows have been carrying interviews with people who had managed to contact survivors, some of whom had required medical treatment.

The island of Bali is a hugely popular destination for thousands of young Australian holiday makers, who view it as one of the safest resorts in South East Asia. They flock to the beaches and bars of the many resorts that have been established to cater for what had been a flourishing tourist industry.

At this time of year many Australian sports teams also visit Bali to celebrate the end of their domestic seasons.

Some players from rugby league and Australian rules football teams are feared to be among the victims.

Vulnerable

There have been warnings in recent weeks that Australians could be vulnerable to attack. On the anniversary of the 11 September 2001 attacks, the Australian embassy in East Timor was closed after such a warning.

In December of last year the Australian High Commission in Singapore was also believed to have been a target in an attack that was foiled by police.

It just goes to show how vulnerable people can be

Simon Crean, Australian opposition leader

But for the general public, many of these warnings will have passed them by.

Australia is a country that has been blessedly free from terrorist attacks.

The last serious incident on Australian soil was the bombing of the Sydney Hilton Hotel in 1978 in which three people died.

But there has never been anything on this scale and no-one would have believed that so many Australians could be targeted in one go.

That has now changed - and the Australian public are now aware that they are equally vulnerable to violent, unexpected tragedy.