Background: Excessive and non-medical use of prescription opioids is a public health crisis in many settings. This study examined the distribution of user types based on duration of use, trends in and associated factors of dispensing of prescription opioids in New South Wales and Victoria, Australia. Methods: 10% sample of unit-record data of four-year dispensing of prescription opioids was analysed. Quantities dispensed were computed in defined daily dose (DDD). Multilevel models examined factors associated with the duration of dispensing and the quantity dispensed in local government areas. Results: Overall, 53% were single-quarter, 37.3% medium-episodic (dispensed 2–6 quarters), 5% long-episodic (dispensed 7–11 quarters) and 5% were chronic users (dispensed 12–14 quarters). More than 80% of opioids in terms of DDD/1000 people/day were dispensed to long-episodic and chronic users. Codeine and oxycodone were most popular items—both in terms of number of users and quantity dispensed. Duration of dispensing was significantly higher for women than men. Dispensing quantity and duration increased with increasing age and residence in relatively poor neighborhoods. Conclusions: Although only 5% were chronic users, almost 60% of opioids (in DDD/1000 people/day) were dispensed to them. Given that chronic use is linked to adverse health outcomes, and there is a progression toward chronic use, tailored interventions are required for each type of users.