Xavier Doherty was the last wicket to fall, going for 15 after hitting a leading edge that popped up to cover off the bowling of Shaminda Eranga.
Australia finished just four runs above their lowest ODI score ever thanks to late hitting from Doherty and Mitchell Starc, who finished unbeaten on 22.
Australia was all out for 74 which ranks equal 27th on worst ODI scores of all time after a spectacular bowling performances from Nuwan Kulasekara and Lasith Malinga.
Sri Lankan paceman Kulasekara claimed his fifth wicket knocking over captain Michael Clarke, Phil Hughes, David Hussey, George Bailey and Moises Henriques in quick succession.
Malinga has taken his third scalp of this astonishing innings, Clint McKay was caught on the crease as the tail-ender edged to wicket-keeper Kushal Perera and McKay was gone for no score.
No Australian batsman besides Doherty and Starc reached double figures, with the scorecard reading, 4, 3, 9, 4, 0, 8, 2, 2, 0.
Mitchell Johnson, on two, tried to work one to the on side, the delivery hit his pad and then straight into his middle stump.
Kulasekara is swinging the ball both ways and knocked over Clarke's middle stump with the Aussie skipper on nine off 26 balls.
Henriques was out for two after being beaten by a Kulasekara in-swinger, Henriques got across and he too was bowled through the gate.
Kulasekara has the impressive figures off 10 overs, 2 maidens, 5/22.
Lasith Malinga has joined the wicket party at the Gabba, taking his two quick wickets knocking over Mitchell Johnson and Matthew Wade.
Wade spooned a catch to backward point on eight off 21 balls, in what can only be described as a soft dismissal under the circumstances.
Hussey was given not out as the Sri Lankan's appealed for a caught behind dismissal, the tourists reviewed it and Hot Spot showed a thin inside edge and Hussey had to go.
The Victorian was trying to cut a ball outside off stump and was taken well by wicket-keeper Perera diving to his left.
Bailey then followed Hussey back to the dressing rooms next ball, Kulasekara got a hint of in-swing and Bailey was forward, the ball hit his pad and was given out.
Hughes was out for three off 14 balls in Kulesakara's third over.
Hughes was trying to push a full delivery to third man but Sri Lankan captain Mahela Jayawardene moved quickly to his left at second slip and took a sharp catch low down.
Australia lost danger man David Warner for just four off eleven balls after he hit an Angelo Mathews delivery straight to mid-off in the third over.
Mathews ball was short and wide and looked inviting to Warner but he flat-batted it to Shaminda Eranga who made hard work of the catch but held on.
Captain Clarke won the toss at the Gabba and elected to bat.
The Australian B-team tag is gone and the first choice side is back with Clarke, Warner and keeper Wade all recalled.
Henriques has been declared fit to play in his return to the national side despite copping a blow to the hand in the Gabba nets on Thursday.
Henriques is playing and Victorian Glenn Maxwell is the 12th man.
Queensland paceman Ben Cutting was released from ODI squad after not making the final twelve to play in Big Bash League final against the Perth Scorchers on Saturday.
The tourists brought back Eranga who featured in the Test series and dropped Ajantha Mendis.