Explain how the evolution of unique Australian flora and fauna can be explained by changed environmental conditions following the break-up of Pangaea.

After the breakup of Pangaea, Australia became an island, thus it was isolated, had its own unique conditions, so according to that unique flora and fauna developed.

Explanation:

Australia was once part of the supercontinent of Pangaea. This supercontinent broke apart though, so later Australia was part of Gondwanaland, together with all of the southern continents at present. Gondwanaland too broke apart, and Australia drifted eastward, becoming an isolated island for tens of millions of years.

As Australia became an island, the environment changed, as the climate changed. Being isolated meant that the flora and fauna didn't had any outside competition, so they were able to evolve in accordance to the environment on the continent without any disturbances. Over the course of millions of years this resulted in the development of flora and fauna with unique traits, which only had similarities with the one from South America until a land bridge opened up with North America.