The population is about 45% Melanesian (Kanak) and 35% European (mostly French) with Polynesians in the outlying islands; the European population is concentrated in S New Caledonia. French, the official language, and several Melanesian and Polynesian dialects are spoken. About 60% of the population is Roman Catholic and 30% is Protestant.

The island of New Caledonia is rich in mineral resources, including nickel, chrome, iron, cobalt, manganese, silver, gold, lead, and copper. It is densely forested in some places, but almost all the kauri pine that was once an important export has been cut down. Nickel mining and smelting are the principal industries, and tourism and fishing are also important. There is subsistence farming, and cattle and poultry are raised, but many foodstuffs must still be imported. New Caledonia receives substantial financial support from France.

New Caledonia is governed under the 1958 French constitution. The president of France, represented by the High Commissioner of the Republic, is the head of state. The government is headed by the president of New Caledonia. The president and cabinet are elected by the legislature on a proportional basis to five-year terms; there are no term limits. The members of the 54-seat Territorial Congress come from among the members of the provincial assemblies, who are elected by popular vote for five-year terms. There is also a Customary Senate that must be consulted on matters relating to Kanak identity; its sixteen members are elected from eight regional custom councils, two from each council, and serve six-year terms. The territory elects two deputies to the National Assembly and one member of the Senate of France. Administratively the territory is divided into three provinces (Northern, Southern, and the Loyalty Islands), each with its own assembly.

Capt. James Cook sighted and named the main island in 1774; the French annexed it in 1853. The discovery of nickel 10 years later brought increased French settlement, and a penal colony was established. The late 1800s saw several Kanak rebellions. During World War II New Caledonia was used as U.S. military base. It became a French overseas territory in 1956. Civil strife erupted in the 1980s as the Kanaks pushed for independence; the 1988 Matignon Accords between French and Melanesian delegations granted considerable autonomy to the islands and increased economic development aid from France. In 1998, New Caledonians approved a power-sharing agreement with France, and agreed to put off an independence referendum for 15-20 years. The territory became a French overseas territorial collectivity with full internal autonomy, and since 2000 governmental powers have been transferred in stages to the territory's government.