The Council Room was originally intended to be the Governor's office. For the first three decades of the 20th century, when the Governor-General resided at Government House, the Executive Council of the Federal Government met in this room, and it is from this activity that the room derives its name and historic associations.

The room is notable for its furniture and appointments including cedar doors, skirting boards, curtain rods and window joinery. Also in cedar is the book case, a pair of early Australian armchairs, and the wall pelmet between the windows, which once operated as a canopy for maps and charts. The marble topped table of Anglo-Indian origin, with carved lion motif legs, is on loan from the Johnston Collection.

The patterned ceiling, floral ceiling rose, and elaborate cornice and architrave are reflective of Victorian style, as are the polished slate mantlepiece and the servants' bells on each side of it. Portraits of past Governors line the room.

The Council Room is now used for special meetings of the Executive Council, for interviews and for receiving some foreign delegations. It also serves as a focal point for the day-to-day administration of the house, being used for meetings of Government House staff.