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As Cate Blanchett steps out of her limo and into the media mayhem of the 79th Academy Awards in Los Angeles tomorrow night, all sorts of things will be bubbling away under that serene exterior. She will be wondering if she's about to take home a second Oscar, for a start. Who wouldn't? But more pressing at that particular point will be running that gauntlet of cameras without an embarrassing fall from a skyscraper-high stiletto which might, say, lead to head-butting Joan Rivers' red-carpet microphone.

"Oh God, yeah," she laughs. "People talk about actors and celebrities strutting down the red carpet, but any person who is placed in front of a thousand flashing cameras would feel the same. I love it, I do. But it is nerve-racking. Especially knowing that they are looking at your toenails and your elbows and you know, have you plucked your nose hairs? And they are looking at your dress and everyone is waiting for the moment where someone trips up. Look, we all love a fashion disaster ­ but hopefully I won't oblige you."

It's almost certain that she won't. Blanchett hardly ever puts a foot wrong, high-heeled or not. And anyway, she's been here before and learnt a few tricks about how to handle Oscar Night. It may be Hollywood's premier glam fest and backslapping jamboree, but it is also, she points out, a "performance", and the way to approach it is with a mixture of poise and a sense of humour. And daunting as it is, she intends to enjoy herself. "At the end of the day you just have to like what you are wearing and you have to have a bit of a laugh about it. It's fantastic to be there and even if the only thing that people on the red carpet want to know is what you are wearing, you have to keep reminding yourself of why you are there in the first place."

The reason that Blanchett has been nominated yet again is simply because she happens to be one of the best actresses working today. There's her fellow Australian, Nicole Kidman, our own Kate Winslet (also nominated but in a different category), Gwyneth Paltrow and very few others of the same generation ­ she's 37 ­ who can cut it with Cate. This will be her third nod. She was first recognised for her career-making role as the Virgin Queen in Elizabeth (she lost to Paltrow) in 1999 and was back, this time as a winner, in 2005 for her gloriously ribald portrayal of Katharine Hepburn in The Aviator. This time out, it's recognition for playing a schoolteacher who has an affair with a 15-year-old pupil in Notes on a Scandal that has brought her another Best Supporting Actress nomination.

But that first, unforgettable Oscar night experience was the funniest and the scariest and the most fun. "The very first time I went I was flabbergasted to see this load of people who are the seat fillers. There's someone there to fill your seat if you have to go out of the room to the loo or something and obviously mine had rung ahead to find out what colour I was wearing. So she was dressed as me! That was really surreal. And I was so nervous, I thought, ŒOh, I'll just go and get a drink from the bar.' I went out and they said, ŒThat'll be $10, please,' and I didn't have any money. So I couldn't even get drunk. I had to wait until the Governor's Ball to get a drink. Now I always take a purse with a lipstick and some drink money."

We meet in a hotel in Berlin where Blanchett is braving yet more red carpets. She has two films, Notes on a Scandal and The Good German ­ which is about to be released in the UK ­ in competition at the Berlin Film Festival. She's here with her family, her husband, the playwright Andrew Upton, and their boys, Dashiell, five, and two-year-old Roman, who are upstairs waiting for her. Blanchett and her family moved from London back to Australia last year. The decision coincided with an offer for Blanchett and her husband to become joint artistic directors of the Sydney Theatre Company. "I tend to be a bit of a strolling player in the sense that what comes up comes up. But there are two factors that play into going back to

Australia: one, the commitment to the STC, and the other one is having two children, wanting to have more, and not wanting them to grow up without knowing their extended family." As much as possible, the children travel with her, although once formal schooling starts that will become increasingly difficult.

"People talk about children before you have them and it's usually sleep-deprived parents who talk about how life shuts down and the compromises one has to make. But I feel completely and utterly expanded by being a mother. And yes there are compromises and things that one can't do, but there are a lot of things that one can do and I just find them hilarious and wonderful. And it's a cliché, but it's true, the reserves of feeling that one finds for them is limitless. You think, ŒI have one, how could I find any more love for a second one?' and you do. It will get harder with schooling but that's the five-year Filofax plan. I used to look at it and think, ŒOh yes, whatever,' but now the five-year planner is out with crosses and Xs and arrows. It's a military operation but it just means being hyper-organised."

Before you meet Blanchett it's easy to assume that she's going to be very guarded. She's said in the past that's she's not about to be psychoanalysed in an interview and regards certain areas as no-go zones. But today she's easy enough to talk to, and her mood perks up considerably when we tackle a subject that engages her, like playing Bob Dylan (of which more later) or her children. Her own childhood was marked by a terrible tragedy: the death of her father, Robert, an American naval officer, when she was ten. In the past the little she has said about that time was simply to point out that such a loss gives you a sense of perspective and a sharp awareness of how valuable life is.

The middle of three children, she attended an all-girls' school in Melbourne and from there went to Melbourne University to study fine arts and economics. After two years, she took a break and went travelling to try to work out what she really wanted to do with her life. She returned convinced that it was the "visual arts" for her, dropped economics and took up a drama course. "I thought about being a curator, but that didn't work. And someone suggested I try for drama school, and I thought, ŒWell, I'll give it a go.'"

At the National Institute for Dramatic Art in Sydney she excelled, and when she left, in the early Nineties, was quickly offered stage work, winning fabulous reviews for David Mamet's Oleanna, with Geoffrey Rush, and playing Ophelia to acclaim in the Company B production of Hamlet. It was just as well that success came early ­ because she's not sure she would have stayed the course otherwise.

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