England fell victim to the Kangaroos' backs at Wigan's DW Stadium before treating the 23,122 crowd to a stirring rally which gives them genuine of hope of reaching the November 14 final.
Trailing 26-0 at the break, England achieved the rare distinction of nilling their star-studded opponents in a passion-packed second-half performance that made a mockery of their earlier woeful display.
Tries from Sam Burgess, Gareth Ellis and Lee Smith, allied to superb individual efforts from little Sam Tomkins and big Eorl Crabtree, turned the game on its head to rekindle hopes of beating New Zealand in Huddersfield next Saturday and earning a final rematch with the Australians.
Yet England had left the field at half-time with boos ringing in their ears as the quicksilver Kangaroos backs cut their defence to ribbons in a show worryingly reminiscent of their 52-4 World Cup rout in Melbourne just 12 months ago.
Tony Smith's men simply had no answer to the rapier-like thrusts of centre Greg Inglis as Australia demonstrated what we knew all along - that England have the forwards but not the backs to match the tournament favourites.
The Kangaroos' first-half points spree was sparked by skipper Darren Lockyer, who marked another landmark occasion in fitting fashion.
The 32-year-old Brisbane stand-off broke Mal Meninga's record as Australia's most-capped player in the opening game and today equalled the feat of another legend, Clive Churchill, in leading the Kangaroos for a 27th time.
Lockyer also matched Ken Irvine's all-time tryscoring record with his 33rd try on his 48th appearance, touching down just four minutes into the match by finishing a move he had started with a looping pass to danger man Inglis.
England might have been level had Kevin Sinfield found a supporting player after opening up the Australian defence with a half-break but instead the pass was snapped up by Anthony Watmough and the tourists counter-attacked with venom.
Full-back Billy Slater went over twice in four minutes after more scintillating handling from man of the match Inglis and the Australian half-backs and the Kangaroos were going at a point a minute when the long-striding Inglis added a fourth try on 22 minutes.
It actually came against the run of play for the introduction of burly forwards Crabtree and Burgess livened up the England attack but, when the latter spilled a wild pass from Danny McGuire, Johnathan Thurston pounced on the loose ball and sent Inglis haring 90 metres for a breakaway try.
It got even worse for England when Inglis got winger Brett Morris over for a fifth try eight minutes before half-time to make it 26-0.
The hosts enjoyed a good spell of pressure in the five minutes before the break without managing to penetrate the solid Australia defence but the cracks began to show when they started the second half in the same vein.
Substitute Ben Westwood was held up over the line but the pressure told when Burgess took Sinfield's reverse pass to stride majestically for the line.
Sinfield added the goal and Burgess went desperately close to adding a second try after collecting McGuire's high kick but could not get the touchdown.
With Crabtree and Tomkins coming into their own, it was all England and they further cut the deficit on 67 minutes when the Wigan half-back's jinking run paved the way for Ellis to force his way over for a second try.
Smith, shifted to the wing for the second half in the absence of Tom Briscoe, added the goal and then a third try seven minutes from the end after taking substitute Kyle Eastmond's pass and squeezing in at the corner.
Australia were down to 12 men by then with Thurston in the sin bin for a professional foul on Smith but they had done enough to secure the points with that emphatic first-half performance.