According to the study, 48 per cent of Generation Y, defined as those born between 1976 and 1990, believe in a god.
The three-year national study, The Spirit of Generation Y, was a joint project between Monash University, the Australian Catholic University and the Christian Research Association.
Dr Andrew Singleton of Monash University, a co-author of the study, said they were surprised by the findings. "It's well-known that there has been a turn away from church attendance and participation in young people," he said.
"But we thought there was going to be a move towards alternative spiritualities.
"There are still a number turning towards it, but not as big as you would have thought."This is the first generation who probably know nothing about Christ.
Robert Forsyth, Anglican Bishop of South Sydney
The survey found 20 per cent of young people did not believe in a god and 32 per cent were unsure.
It also found that just 19 per cent of those who identify themselves as Christian were actively involved in a church, attending services at least once a month.
More than 30 per cent of Generation Y were classified as humanists, rejecting the idea of a god, although some believed in a "higher being".
Dr Singleton said it was a trend that was likely to continue: "We live in a very individualistic and self-orientated society and I don't see a lot of things challenging that. One of the many predictors of whether we become religious is our parents and unless there is a massive cultural shift, I see that the trajectory will continue as it is."The researchers said many young Australians were humanists, rejecting belief in a god and replacing that with a belief in human experience, human reason and scientific explanations.
Robert Forsyth, Anglican Bishop of South Sydney, said the results were expected.
"This is the first generation to have nothing to do with Sunday school," he said.
"This is the first generation who probably know nothing about Christ, except those who go to Christian schools.
"It is sad, but in my view it is entirely what we expected to happen."
