Melbourne beat the other 139 cities assessed, performing exceptionally well on all five overarching criteria – stability, healthcare, culture and environment, education and infrastructure. Melbourne achieved perfect scores of 100 on healthcare, education and infrastructure. It also scored a perfect 100 in the sub-category of sport.

Ongoing investment in Melbourne's world-class infrastructure was highlighted in the report for keeping Melbourne at the top of the index – where it has finished every year for the past four.

"Our low crime rates, great health system, harmonious multicultural community, excellent education system and road and rail network all played a part in our great city taking out this coveted award again," Dr Napthine said.

"The excellence of our healthcare and education systems has been recognised by astute international judges."

Deputy Premier and Minister for State Development Peter Ryan said Melbourne had a global reputation for being a great city, particularly for its extraordinary range of major events.

"Melbourne, Victoria hosts the Australian Open tennis, the Spring Racing Carnival and the Formula 1 Grand Prix all of which attract tens of thousands of visitors from around the globe," Mr Ryan said.

"Next year we also play host to the ICC Cricket World Cup, the Asian Football Cup, and Rugby League's State of Origin. And, of course, visitors love coming to watch AFL football, with the jewel in the crown being AFL Grand Final week.

"We are also renowned for our cultural events and infrastructure. As the theatre capital of Australia recent productions in Melbourne have included the King and I, Les Misérables, the Rocky Horror Show, and Wicked.

"This added to the recent Melbourne-made production of King Kong which generated an economic benefit of $104 million.

"That is why the number of international travellers using Melbourne Airport has risen from 587,000 in July 2012 to 725,000 in July 2014."

Melbourne Lord Mayor Robert Doyle was delighted with the result.

"To be named the world's most liveable city for four consecutive years is a great honour and a testament to the enviable lifestyle that Melbourne offers," the Lord Mayor said.

"Safety, sustainability and smart growth have been the keys to Melbourne's liveability and prosperity. Providing transport and infrastructure have been key elements in smart growth," the Lord Mayor said.

Melbourne also won Conde Nast Traveller magazine's gong for world's friendliest city yesterday.

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