Exiled Tibetan spiritual leader, the Dalai Lama, has warned that technology can add to the modern confusion that clouds the universal search for happiness.

Speaking to 18,000 people at Melbourne's Rod Laver arena, the Dalai Lama did admit that information has an important role in improving human relations.

"Science, technology and other material facilities in the developed world lead people to believe that their problems will all disappear," he explained. "We have seen that this is not the case."

But the Dalai Lama said that "intelligence itself is the ultimate source of power".

Partly thanks to information "human foresight is improving which will lead to a more peaceful world", he concluded.