Australia once rode to prosperity on the sheep's back, but nowadays children are so divorced from rural life many believe yoghurt grows on trees.
A survey by the Australian Council for Educational Research found 27 per cent of Year 6 pupils - and even 13 per cent of Year 10 children - thought yoghurt was a plant product.
And 40 per cent of the Year 10s believed cotton came from an animal.
Cameron Archer, chairman of the Primary Industries Education Foundation, which commissioned the research, said it confirmed "we're a very urbanised nation".
He told the Sydney Morning Herald: "Food is relatively cheap. Everyone takes it for granted, and we're quite complacent about our well-being."
Pupils from 61 schools across Australia were shown a hypothetical lunch box of bread, cheese and a banana.
Only 45 per cent of Year 6 pupils knew all three came from agricultural products - even though half were involved with a school vegetable garden and 15 per cent had visited or stayed at a farm through their school.
Archer said the findings - based on questioning more than 900 children in both rural and urban areas - were a "wake-up call". "I was surprised that some of these very, very basic relationships weren't understood."