Kidman was given the honor last year, but the presentation was delayed because of her film commitments and her wedding last summer to country singer Keith Urban.
Urban and Kidman's parents were among the guests at the invitation-only ceremony for 40 recipients, which Kidman reportedly chose over a private investiture.
Australia Governor-General Michael Jeffery presented the medal, which honors the actress for her film career, and for her charity work in work promoting women and children's health.
The Companion of the Order of Australia is the nation's highest honor, equivalent to an English knighthood, and is awarded for "eminent achievement and merit of the highest degree in service to Australia or humanity at large."
The 39-year-old actress, a UNICEF goodwill ambassador, won a best actress Oscar in 2003 for her role in the movie "The Hours."
She is in Australia to film Baz Luhrmann's romance "Australia," also starring fellow Aussie, Hugh Jackman. Rehearsals have been under way for a week at Sydney's Fox Studios. In the World War II film, Kidman, who worked with Luhrmann on the movie "Moulin Rouge," plays an English noblewoman who inherits a ranch in Australia.
While she was accepting her award, her co-star was taking riding lessons in Sydney's Moore Park to prepare for his role.