Heath Ledger is revelling in his latest role as father to his baby daughter MATILDA.

The actor and his girlfriend, Brokeback Mountain co-star Michelle Williams, are adjusting to their new life with their 11-week-old daughter.

Ledger says, "I just adore her... waking up every morning and releasing her from these little straight-jacket swaddle things that we have her in.

"When you release her in the morning she just smiles at you and her little arms just stretch up. It's just magic."

The new family is spending time at their home in Sydney, Australia, as well as their new residence in Brooklyn, New York City, and Ledger has never been happier.

He says, "I'm very lucky I have two beautiful girls in my life."