travelling from sydney , australia, we are looking at driving from either san francisco or l.a. down into mexico. most likely around october, we hav about 3-4weeks. we intend just taking in some of the sights both on and off the beaten track, also it would be cool to fit in a few surfs along the way, possibly spending a few days somewhere in mexico on the coast, not exactly backpackers or 5 star travellers, im inviting any advice or suggestions on do's and dont's, must see's , cool places to stay etc. any info. much appreciated., rental car arrangements would also be handy. thanks

Unless one purchases special, separate and usually expensive insurance, one can not rent a car in US and drive into Mexico. I can not imagine that rules would be any different for Australian citizens. I would check with various rental car companies before you plan the drive.

I imagine it might be possible to rent a car in Mexico, but I have no personal experience with that.

Often US rental car companies simply will not allow you to take a car into Mexico. You might have to drop your US car in San diego, cross the border on public tansit and then pick up a different car in Mexico.

Be sure you are fully insured in Mexico - the rules for traffic offenses/
accidents can be quite draconian - and often involve large cash fines to the police - as well payment of official damages. There have even been reports of drivers being imprisoned until the fines are paid.

Most US car rental companies will not allow you to take their vehicles into Mexico, simply because of the huge risk that they will be stolen. Enterprise used to have some rentals available to go into Mexico, but you had to pick them up from the Enterprise office in National City, I think.

Mexican insurance is not particularly expensive and there are many, many places to buy it close to the border. If you drive into Mexico, you MUST buy Mexican insurance. If you are involved in even the smallest fender-bender accident and you do not have Mexican insurance, you will go to jail until the police determine who was responsible and any fine/damages are paid. This can take months. Mexican jails are extremely unpleasant. Be sure your travel insurance includes air medical evacuation. If you are injured in an accident in Mexico, you will want to get to a hospital in the US as soon as possible.

I would recommend that you stay in the US.

I just read a great article on msnbc.com about a family road trip into Mexico, south of San Diego. Here it is:
http://www.msnbc.msn.com/id/12393630/

Sounds like they used their own vehicles, so as everyone else said, you need to check into rental policies.

I would fly from Los Angeles to someplace central to the region you want to visit - Cancun or Mexico City or Oaxaca or Puerto Vallarta for example. Then rent a car there or travel by bus. Mexico is one HUGE country and that's one LONG drive even having 3-4 weeks.

And as others have mentioned I don't think US rental cars can cross into Mexico, or not cheaply or easily.