The Classification Board has given an unrestricted M rating to a magazine featuring a nude six-year-old girl on the cover.
The Art Monthly Magazine caused an outcry with the picture of Olympia Nelson on the cover.
The board reviewed the entire July edition of the magazine, and yesterday, in a split decision gave it the classification.
The M rating means the magazine is not recommended for readers under 15 years of age.
A spokeswoman for the board told AAP: "The Board notes that the images in this publication have been classified Unrestricted within the specific context of the publication as a bona fide and serious vehicle for the discussion of the arts.
"The overall tone of the publication and the debate contained therein is considered to be serious and have genuine artistic and educational merit.
"The Board notes that the images and text within the publication that relate to the ongoing debate about the difference between art and pornography and the sexualisation of children require a mature perspective."
A minority on the board wanted to give the magazine a Refused Classification, meaning it would not be able to be sold, the spokeswoman said.
But that minority were split over what images, both on the cover, and inside, deserved the rating.
There were other sexually graphic images within the magazine.
Olympia's mother, Polixeni Papapetrou, took the photo in 2003.
Olympia's father, Robert Nelson, who is an art critic, told Fairfax News the family, especially Olympia, felt vindicated by the decision.
"I think she's feeling very happy because her argument has always been there's nothing wrong with the picture," he said.
"The idea that it's pornographic is absurd."
The magazine was criticised by Prime Minister Kevin Rudd, who said he did not approve of the images.
Some politicians suggested the funding of the magazine by the Australia Council should be reviewed.
The magazine came out only a month after police seized works of naked adolescents by renowned photographer Bill Henson.
