Postecoglou guided the Joeys and Young Socceroos to the second stage of their respective world championships in 2001. He was also in charge of the 2003 Young Socceroos side which beat eventual champion Brazil in the group stages. However, he came under fire for subsequent failures of the national under-17 and under-20 teams in world championships.

Condemnation of Postecoglou's coaching of the Australian youth teams came to a head after an infamous onscreen quarrel with SBS's Craig Foster:

Criticism of Australian youth coaches continued last year after Graham Arnold was condemned for the performances of the Olyroos. However Postecoglou has leaped to the defence of his and Arnold's efforts with Australia's youth stars.

"When my time [at the Young Socceroos] ended I thought it was time to look at the unrealistic expectations," Postecoglou told au.fourfourtwo.com. "We have come into Asia and are expected to fend off all of Asia for some unknown reason.

"I didn't and don't understand it, we simply don't have the results on the board. We still don't produce a multiple of young players who play all over Europe. Until we do that on a regular basis then we need to temper our expectations."

However Postecoglou believes the A-League will become the perfect grooming ground for developing local talent.

"The A-League is getting stronger all the time and the standard is getting better. The A-League is also going to help with the young players, a lot of the Olyroos that went away to Beijing were the players I coached at under 20s and 17s, and we were going to World Cups and our players were not playing any sort of decent standard of football for the 18 months before going into a World Cup.

"Now with the A-League up and running it is great to see some of the young players playing senior football, these things are more important than who the coach is and sacking the coach if the results are not right."

Postecoglou was also positive about the expansion and development of the A-League, but stated there is still room for improvement.

"The A-League expansion is coming along at the right time, a couple more teams will add more excitement. Two more teams will make the finals look a more interesting affair. With the National Youth League and the Asian Champions League everything is becoming more professional and that is being reflected in the standard. The game is getting a bit quicker and we are starting to produce better players.

"I have seen improvement every year in the A-League, but the final level will be if we can attract some top level international players. The imports so far have been fairly disappointing and if you look at the major leagues around the world, then imports play a big part in the success of the league as they add that X-factor. When you bring in a player from another country they can attract crowds and that is an area that A-League clubs haven't really factored in."

Postecoglou left Australia in March last year to manage Greek team Panachaiki, however his time at the helm came to an end in December after rumoured clashes with those running the club.