Baz Luhrmann's daughter Lilly addresses rumours about father's sexuality

Baz Luhrmann's daughter Lilly has spoken out about the speculation surrounding her father's sexuality.

During a recent appearance on the Under the Gloss podcast, Lilly was asked when she first realised that her father is a famous movie director and her mother Catherine Martin is an Oscar-winning costume designer.

The 19-year-old recalled how she was followed to school by paparazzi in 2013 when she was 10, around the time the press was speculating if her father was gay because her parents sleep in separate bedrooms.

"They were bullying my dad there for a little bit there," she recounted. "I specifically remember there was a time where I was driving in the car and on the radio, this guy was like, 'Today we're gonna be discussing, is Baz Luhrmann gay? Breaking news: (they) sleep in two different bedrooms.'"

When she arrived at school that day, Lilly was bombarded by questions about her father's sexuality.

"That was the first time I felt … not embarrassed, but more just like, 'Why are people talking about my dad? Why are they making fun?' And the kids at school were like, 'Well, your parents sleep in two different bedrooms; your dad's gay.' I'm like, 'They just have different sleeping schedules!'" she remembered.

Luhrmann and Martin have been married since 1997 and they also have a 17-year-old son named William.

In 2014, the Elvis director explained to the Daily Mail Australia that they have separate bedrooms because they "both need space" and "time to ourselves", while they told The New York Times that same year that Luhrmann is an insomniac who cannot sleep and Martin would have "to kill him" without her own bedroom.