Lupin is a major rotational crop produced abundantly in Australia. Three varieties of sweet lupins are grown in Australia depending on soil types and climatic conditions; these are white lupin (Lupinus albus), blue lupin (Lupinus angustifolius), and yellow lupin (Lupinus luteus). In this study, polysaccharides from the three lupin species have been extracted with hot water and a range of their biological activities investigated. The antioxidant activities of lupin polysaccharides have been measured in terms of ABTS *+ radical and hydroxyl radical scavenging activities, and their affinity to chelate with iron. Immune-enhancing power of the lupin polysaccharides was examined by measuring their capacity to stimulate the macrophages (RAW 264.7) to release TNF-α and nitric oxide. The prebiotic activities were determined against the beneficial probiotics such as Lactobacillus rhamnosus DR20, Lactobacillus acidophilus LAFTI L10, Bifidobacterium lactis DR10, and Bifidobacterium animalis BB-12. Polysaccharides from the three lupin species have exhibited significant antioxidant, immunostimulatory, and prebiotic activities. The results demonstrated that blue lupins displayed the best activities, and therefore are expected to possess high potential to be used as nutraceutical and functional ingredients with significant therapeutic value. FT-IR spectroscopic technique was employed for a preliminary structural characterization. Studies involving surface morphology and thermal behavior have indicated that the lupin polysaccharides are suitable for end product development.