Between 16 and 17 million people are expected to vote across the vast island-continent, with the opposition centre-left Labor party tipped for victory.
Casting his ballot in Melbourne, would-be prime minister Bill Shorten was bullish about forming a majority government after a final poll showed his lead increasing.
"Today is the people's day," he said. "Be it buying a 'democracy sausage', the kids having a bit of a sugar cake or what have you, and voting."
"In the event that the people of Australia voted to stop the chaos and voted for action on climate change, we will be ready to hit the ground from tomorrow."
Weeks ago, Prime Minister Scott Morrison's conservative Liberals had been heading for an electoral drubbing.
But he has closed the gap with a fiercely negative campaign -- backed by powerful right-wing media -- targeting older, wealthier voters who face fewer tax breaks under Labor.
On the eve of the election, Morrison predicted it would be "the closest election we've seen in many, many years".
But anger over his government's inaction on climate change may prove the difference between the two parties.
A season of record floods, wildfires and droughts have brought the issue from the political fringes to front and centre of the campaign.
In traditionally more conservative rural areas, climate-hit farmers are demanding action. And in several rich suburbs, a generational shift has seen eco-minded candidates running Liberal party luminaries close.
In northern Sydney, former prime minister Tony Abbott -- who once described climate change as "crap" -- appears at risk of losing a seat he has held for more than two decades to independent challenger Zali Steggall, a lawyer and Olympic medallist in Alpine skiing.
Early rising voters in the constituency trickled into a beachside surf club to cast their ballots, as volunteers wearing bright orange "I'm a climate voter" t-shirts handed out pamphlets.
"I'm worried about the climate and that Australia is not doing enough," volunteer Catherine Willis told AFP.
Shorten has pledged quick legislation to increase renewable energy, while the Liberals said they would not risk the coal-fuelled economy's health to make the air cleaner.
Australia is among the world's largest exporters of coal, providing thousands of jobs in the northeast of the country.