Healthy food subsidy programmes have not been widely implemented in high-income countries apart from the USA and the UK. There is, however, interest being expressed in the potential of healthy food subsidies to complement nutrition promotion initiatives and reduce the social disparities in healthy eating. Herein, we describe the impact of a fruit and vegetable (F&V) subsidy programme on the nutritional status of a cohort of disadvantaged Aboriginal children living in rural Australia. A before-and-after study was used to assess the nutritional impact in 174 children whose families received weekly boxes of subsidised F&V organised through three Aboriginal medical services. The nutritional impact was assessed by comparing 24 h dietary recalls and plasma carotenoid and vitamin C levels at baseline and after 12 months. A general linear model was used to assess the changes in biomarker levels and dietary intake, controlled for age, sex, community and baseline levels. Baseline assessment in 149 children showed low F&V consumption. Significant increases (P< 0.05) in β-cryptoxanthin (28.9 nmol/l, 18%), vitamin C (10.1 μmol/l, 21%) and lutein-zeaxanthin (39.3 nmol/l, 11%) levels were observed at the 12-month follow-up in 115 children, although the self-reported F&V intake was unchanged. The improvements in the levels of biomarkers of F&V intake demonstrated in the present study are consistent with increased F&V intake. Such dietary improvements, if sustained, could reduce non-communicable disease rates. A controlled study of healthy food subsidies, together with an economic analysis, would facilitate a thorough assessment of the costs and benefits of subsidising healthy foods for disadvantaged Aboriginal Australians.