Nicholls was appointed Governor of South Australia on 1 December 1976, on the nomination of Premier Don Dunstan. He was the first non-white person to serve as the governor of an Australian state, and is the only Aboriginal person to have held viceregal office. Because of his race, his nomination proved controversial and attracted more attention than most viceregal appointments. A poll by ABC's "This Day Tonight" found that 70 percent of respondents opposed Nicholls becoming governor. "The Canberra Times" expressed concern that members of his family might set up camp on the grounds of Government House. However, Adelaide's main daily newspaper "The Advertiser" was more positive, welcoming the news "without reservation". News of the appointment was leaked in May 1976, after which he agreed to appear on "A Current Affair". Nicholls took exception to a question directed at his wife, calling the interviewer a racist and requiring him to leave his house. GTV-9 aired the footage without his permission, and subsequently apologised for doing so.