Exercise Strike Warrior is under way and will run for 12 days.
Eleven nations, 27 ships, three submarines and 84 aircraft are taking part in the exercise involving more than 8,000 personnel.
Australia has joined NATO nations the UK, the US, Denmark, France, Germany, Latvia, the Netherlands, Norway and Poland in participating, with 34 naval units.
The exercises will mirror a broad range of crisis and conflict situations.
It is the third and final exercise designed to test the UK Carrier Strike Group ahead of its first operational deployment to the Mediterranean, Indian Ocean and East Asia.
The Carrier Strike Group is led by aircraft carrier HMS Queen Elizabeth.
The two-week exercise sees the task group exercise with warships from NATO's Standing Maritime Group 1 in waters off the Scottish northwest coast to demonstrate its capability to carry out high-intensity operations.
The Carrier Strike Group will be passed as ready for deployment after the exercise.
HMS Queen Elizabeth is accompanied by destroyers HMS Diamond and HMS Defender, frigates HMS Richmond and HMS Kent, US Navy destroyer USS The Sullivans and Dutch ship HNLMS Evertsen.
Royal Fleet Auxiliary ships RFA Fort Victoria and RFA Tidespring are supplying the Strike Group with fuel, food, stores and ammunition.
Cover image: RFA Fort Victoria carries out a replenishment at sea with HMS Queen Elizabeth ahead of the exercise (Picture: Royal Navy).