Posting a video to social media, the pop sensation announced the news, saying the performance will be “one of the highlights of my career”.
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“Australia has meant so much to me as a queer person,” said Smith.
“I cannot wait to be with you all after such a challenging time, and hopefully we can spread that love and celebrate and sing and dance.”
The Grammy Award-winning artist joins previously announced acts Dua Lipa and Kesha as headliners for Mardi Gras – a 17-day-long arts festival which launches on Valentine’s Day.
Sydney Mardi Gras’ parade and party, where Smith will perform, will be held on 29 February.
Smith came out as gay at age 10, and in September last year came out as non-binary.
The 27-year-old now uses the gender pronouns “they” and “them” so as to “embrace myself for who I am, inside and out.”
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You can purchase tickets to the Mardi Gras party at Hordern Pavilion here.