Karalee, a residential and rural/residential suburb, is 10 km north-east of central Ipswich and 20 km from central Brisbane.
It is bordered on the north and east by the Brisbane River, the boundary extending from near Colleges Crossing to a few kilometres short of Barellan Point. Its southern boundary is partly formed by the Bremer River. A large suburb, Karalee measures six km from north to south.
It is thought that the name was derived from an Aboriginal expression describing grass near a waterhole.
In the late 1960s Karalee's dairy and farm holdings began to be bought up for future subdivision. Most allotments were of the rural/residential scale (2000 sq metres or more) and house building started in the early 1970s. Land was reserved for a state primary school in 1979, and Karalee school opened in 1985 with an enrolment of 186 pupils. Before then children attended Tivoli primary school.
The area west of the school was subdivided in the 1980s, and the area bounded by the Brisbane River was cut up in the 1990s-2000s. With river views on three sides it is that part which has been most lucrative: a report for 2004 put Karalee as the top growth postcode, recording a 51% increase in property prices.
Karalee has a community hall north of the school, and north of that there are a canoe trail and the Venus Pool on the Brisbane River. Local shops are west of the school, near Mount Crosby Road.
The south-west sector of the Karalee area is the suburb of Barellan Point, named after the tongue of land where the Bremer River joins the Brisbane River ('Bremer Junction'). At the point there is the Joseph Brady Park, with a launching place for Bremer River canoe trail. Barellan Point is also rural/residential.
In January 2011 Karalee had minor riverside flooding along the Brisbane River east of Colleges Crossing, but flooding from the Bremer River was extensive. The Warrego Highway was covered and water flowed north to the edge of the primary school. Barellan Point was similarly invaded from both rivers.
Both suburbs had above-average median incomes and relatively young populations in 2008:
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Census population were: