In 1988 he joined Neighbours co-star Kylie Minogue in signing for Stock, Aitken and Waterman's record label PWL and he started to release singles which appealed to his pre-pubescent fanbase. His duet of the song Especially For You with Minogue was the fourth-highest selling single in the United Kingdom that year. Donovan and Minogue dated for a time during this period.
He spent a long run playing Joseph in the West End musical Joseph and his Technicolour Dreamcoat. He has also played Frank 'N' Furter in The Rocky Horror Show musical.
In 1992 he sued The Face magazine for libel over allegations that he was homosexual. He won the case but lost credibility in the process.
His career suffered from his drug problems. In 1999, he admitted that he still used cocaine saying "I still have a joint and I still take coke, but not as much as I did two years ago,"  (http://news.bbc.co.uk/1/hi/entertainment/281941.stm)
According to recent media profiles, his two young children and a steady relationship with their mother has tamed him substantially, and he has began to get more steady work as a serious actor, notably in a role in the highbrow medical-legal drama on Australia's ABC network, MDA in 2003.
In late 2004, he was headlining in Chitty the Musical at the London Palladium in England.