Coexisting primary minerals and hydrous alteration minerals in basalt lavas of the Upper Permian Broughton Formation of the Sydney Basin are indicative of the involvement of a hydrothermal fluid phase during low-grade metamorphism. Variation and zonation of alteration phases in vesicles and vugs indicate that the alteration minerals developed in response to several episodes of precipitation, with early CO2-rich fluids producing assemblages rich in calcite and chlorite-smectite while later CO2-poor fluids precipitated Ca-zeolites, prehnite and pumpellyite. Vesicular parts of flows typically show much higher contents of alteration minerals than more massive parts of the same flow, but no systematic increase in either the style or intensity of alteration with increasing depth in the lava pile is evident. The presence of Ca-zeolites, prehnite, pumpellyite and rare epidote suggests uppermost zeolite facies to lowermost prehnite-pumpellyite facies metamorphism. Stability relationships of the metamorphic phases based on experimental and theoretical studies, used in conjunction with measured parameters for modern geothermal systems, indicate a peak metamorphic temperature of ~200-230��C while the extant stratigraphy indicates that the maximum depth of burial was ~1200 m. Alteration developed in response to circulation of hot, aqueous fluids generated by thermal convection cells associated with the Permian lavas and/or a large buried intrusion.