Blue Sky Mining, produced by Warne Livesey, was first released by CBS/Columbia on 25 February 1990.

The album was "more defiant and outspoken" than their previous work; the single "Blue Sky Mine" describes asbestos exposure in the Wittenoom mine tragedy. The second single from Blue Sky Mining was "Forgotten Years".

At the ARIA Music Awards of 1991, Midnight Oil won 'Best Group' and an 'Outstanding Achievement Award', and were awarded 'Best Cover Art', 'Best Video' and 'Album of the Year' for Blue Sky Mining.