Alkaline magmatism in the Southern Highlands Province, New South Wales, Australia is associated with continental rifting. Near-primary liquids have a wide range in Nd and Sr isotope composition that indicates gross isotopic and chemical heterogeneities in a mantle source region depleted in light rare earth elements (LREE) for much of Earth's history. The large-ion lithophile element and LREE-enriched nature of the primary lavas ((Ce)N = 95-182 and (Yb)N = 8.5-13.3) is consistent with an enriched mantle source region. This elemental enrichment may be accomplished by veining of the subcontinental mantle with volatile-rich phases like amphibole, apatite and carbonate which provide the volatile flux necessary to trigger anatexis. Degassing of mantle CO2 has led to migration of LREE-enriched fluids and local transformation of the lherzolitic mantle to pyroxenite veined by apatite ± kaersutite ± mica ± diopside. The mantle veining event may be related to upwelling of silica-undersaturated incompatible element-enriched magmas similar to the host magma of the Kiama xenoliths. In a relatively short period of time (100 m.y.), the Sr and Nd isotopes in essentially LREE-depleted mantle have evolved in response to low Sm/Nd and low Rb/Sr ratios, and now define a near-vertical vector on a isotope-isotope plot. From this rather unique signature we can infer that CO2- and LREE-rich, Rb-poor mantle is a potentially suitable mantle source region for the genesis of alkali-potassic volcanic rocks characterized by a narrow range in 87Sr/86Sr ratio and a wide range in 143Nd/144Nd ratio (e.g. Leucite Hills).