Imagine, if you will, a building containing a machine made by Belgian artist Wim Delvoye that mimics the human digestive system; a soundproof room where 30 fans of Madonna sing a capella renditions of songs from her 1990 greatest-hits album, The Immaculate Collection; and a brand new red Porsche that has been radically altered, as if by Botox, by Erwin Wurm. There is also the notorious image of the other Madonna, The Holy Virgin Mary by Chris Ofili, studded with elephant dung and framed with pornographic images (when it was shown in New York in 1999, it so angered Rudolph Giuliani, the mayor of the city, that he almost cut off funding for the Brooklyn Art Museum, where it was being exhibited). An underground tunnel leads to a library of glass and lead books by German superstar painter and sculptor Anselm Kiefer.
Welcome to the Museum of Old and New Art (Mona) in suburban Hobart, Tasmania, where Egyptian mummies in glass cases are dotted among modern and contemporary art from around the world and admission is free. This is an astonishing collection, but so is the building that houses it. It is a structure larger than the Saatchi Gallery in London and on four levels, all underground (with a vineyard above) and some below sea level. Its setting on the banks of the Derwent River is equally astonishing, a 45-minute ferry ride from the centre of Hobart, the capital of Tasmania, Australia's island state. This was once the home of the Mouheneener band of Aboriginal people.
The greatest astonishment - and these epiphanies appear stacked like Russian dolls - is David Walsh, the man behind Mona, which opened late last month. First of all, he looks like a roadie for the Grateful Dead. He was born in Moonah, a working-class suburb not far from where the museum is situated. He studied mathematics at the University of Tasmania, but dropped out when he found that his photographic memory was very useful for counting cards and separating casinos around the world from their profits.
At first he worked as part of an international syndicate, but when the casinos banned such groups, he developed computer systems for winning at horse racing, now mostly carried out via the internet from computers in darkened rooms. To date, he has put A$200 million (£124 million) of his own money into Mona.
Which brings us back to the building. It is more of a campus than an art gallery, with restaurants, accommodation, vineyards, a brewery and stages front and back for Walsh's beloved rock bands to play on. During Mona's opening weekend, more than 50 acts appeared, including Wire, the British art-punk pioneers, and Groupe F, a group of pyrotechnic artists from France.
The setting is near perfect. Hobart's natural harbour is twice as deep as Sydney's and the city is built around a mountain roughly the size of Ben Nevis. In terms of cultural tourism destinations, Mona is not only up there with Tate St Ives, the Pier Arts Centre in Orkney and Count Panza's collection in Northern Italy - it is also bigger and more dangerously ambitious, as befits the brainchild of an outlawed card sharp.
At ground level, beyond the obligatory shop and restaurant, visitors to Mona are given iPods and told that there are no labels or explanatory texts in any of its many galleries. Should you wish to know the creator of any given work, you press a "refresh" button and details of the works in your immediate vicinity flash on the screen. There is a special icon named "artwank" that gives the collector's own thoughts on the work in front of you.
Walsh's dislike of explanatory texts is equalled only by his boredom with the concept of the "white cube", to which 99 per cent of the world's museums still adhere. In Mona, most of the walls are very dark, as you find out when you take the bubble lift down to the lowest level, or trek down what must be the world's longest spiral staircase, as if descending a mineshaft. And then you see it: a sheer cliff face, more than 250 million years old, excavated from above and now forming a honey-coloured interior facade.
On the ground level at one end of the cliff is a bar serving everything from absinthe to Walsh's own fine wines and beer. Walsh, the media pack attending the opening is told in Mona's large lecture theatre, thinks alcohol and art should mix as much as possible and that we should allow our perceptions to be altered by both.
He won't speak to the media, playing the reclusive card, but I manage to catch half an hour with him later, next to the fake superfiction of a tennis court he insisted be built on the roof, against all the protestations of his architect, Melbourne-based Nonda Katsalidis. We stand near the tennis court so that he can hear whether there is any crossover of sound from the electric-folk band playing on one side of the hill and the goth band on the other.
He talks to me about his curators and advisers, who include Jean-Hubert Martin from France, who directed the epochal Magiciens de la Terre at the Centre Pompidou (where he later became director) in 1989. Martin's former assistant, Olivier Varenne, curates most of the international work in the collection, and Londoner Mark Fraser, a University of Cambridge graduate and the former head of Sotheby's Australia, is now director of Mona. Fraser was headhunted by Walsh for the role.
I ask Walsh about his future plans, and he says: "I want to link to different pubs around the world via the internet and Skype, so that you can be sitting with a beer in North Hobart or here at Mona and having a chat, talking about art and ideas, with someone in a bar in New York or a pub in London's East End, all in real time.
"My architect is also working with French artist Céleste Boursier-Mougenot to build an enclosure on the roof of the museum for his installation of live zebra finches playing Les Paul guitars. This was a huge success at London's Barbican last year and should open here in five or six months," he says.
The press is requested to play down Walsh's much-quoted throwaway remarks that his museum is themed around "sex and death" and that it is a kind of "adult Disneyland". However, once you've witnessed the enormous Jannis Kounellis wall installation of huge sides of beef hanging on a metal grid; once you've made a rubbing on large blocks of stone brought from Hiroshima; once you've searched for the secret room where two young women engage in telephone sex; and once you've seen British artist Jenny Saville's painting of a transgender nude, you are inclined to stay with those descriptions.
Death certainly stalks these subterranean galleries. In one there is an installation about euthanasia, comprising a rather comfortable-looking leather couch. An open laptop on a table sits next to a giant syringe and coiled tubing presented within a glass case. This work, called My Beautiful Chair, is a collaboration between artist Greg Taylor and Australian euthanasia campaigner Philip Nitschke. During the museum's opening weekend, perhaps in a nod to J.G. Ballard's novel Crash, an actual car crash was staged by Roman Signer as guests left the museum. The end result will remain as a "paralysed" sculpture on the Mona site.
Somewhere in between these two events is a "wall of death" where anyone can apply to have their ashes interred. At the moment the only urn present contains the remains of David Walsh's father, who died recently.
But to the themes of sex and death, one would have to add bodily functions. The unisex toilets next to the absinthe bar contain an artwork named Locus Focus by an Austrian collective, Gelatin. With the aid of mirrors, video and a pair of binoculars on a string, it allows you to watch your own excretions emerging in real time.
It was Wim Delvoye's Cloaca Professional machine, however, that drew the big crowds. Several beautifully constructed glass vials, each over a metre high and looped together with tubing, cut diagonally across one large room. Twice a day a gallery assistant "feeds" this artwork at one end, and twice a day the digested results appear as mock turds at the other. The body as animal, as machine, is one of Walsh's favourite tropes.
This is one of many new commissions made especially for the opening exhibition, which Walsh has titled Monanism. There are 460 works on display from his total collection of 2,210 pieces. Many are on a huge scale, including Christian Boltanski's The Life of C.B. (2010) and a work called Snake (1970-72) by the late Sir Sidney Nolan, which has never been exhibited before because it is so large. Until Mona's embrace it had been stored in boxes gathering dust. Now it curves around the central gallery in hundreds of panels that cover 5,380 sq ft and stares across at Kounellis' grid of meat.
Not everything in Mona can be linked to sex and death. Tasmanian artist Brigita Ozolins has been working for several years on a sublime maze-like installation studded with text and numbers that forms a main part of the opening exhibition, while on one gallery floor a cubic metre of ice made from frozen black ink melts into a dark puddle. A Damien Hirst "spin" painting rotates slowly in semi-darkness, a metaphor for the decline of what was once known as Young British Art.
Later, in Mona's black phone book-sized catalogue, I see some of the art I've missed, including works by Jenny Holzer, Jean-Michel Basquiat and Andres Serrano. It was Serrano who came to fame, or at least notoriety, with his Piss Christ image in the late 1980s. At the very end of the catalogue is a specially commissioned photographic portrait of Walsh by Serrano: the gambler-collector sits naked and stares in shock at the camera lens. All bets are apparently on.