Hardik Pandya again proved the thorn in Australia's side as the all-rounder struck 78 to help India wrap up a series victory and return to the top of the ICC ODI rankings.
Aaron Finch's powerful 127 had put Australia in a strong position, but a familiar middle-order collapse restricted Steve Smith's side to a sub-par 293 on a flat Indore wicket.
The tourists were sitting pretty at 224-1, but the loss of four wickets for 36 runs halted their momentum at a crucial juncture.
Kuldeep Yadav (2-75), coming off a hat-trick in Kolkata, removed Finch and Smith to turn the contest in India's favour, with Australia managing only 59 runs off the final 10 overs.
Ajinkya Rahane (70) and Rohit Sharma (71) combined to give Virat Kohli's men a solid platform, but Smith's failure to hold a high ball when Pandya was on 41 proved a critical reprieve as the rising star, who made 83 in the series-opener, secured India a decisive 3-0 in lead the five-match series.
Finch returned from a thigh injury at the top of the order, combining for Australia's first 50-run opening stand of the series with David Warner, before his partner was cramped by a Pandya off-cutter and bowled for 42.
Unbowed, Finch attacked wrist-spinners Kuldeep and Yuzvendra Chahal, who had combined for 10 wickets across the first two matches, registering his eighth ODI hundred from 110 balls, sweeping Kuldeep behind square for four to bring up the milestone.
But the left-armer persisted and finally broke the second-wicket partnership on 154 as Finch bludgeoned a catch to mid-wicket, sparking Australia's downfall.
Smith fell to Kuldeep four overs later and Glenn Maxwell (5), Travis Head (4) and Peter Handscomb (3) all failed as the visitors lost 5-69 from the last 12.2 overs.
India wasted no time in getting ahead of the required run rate with Rahane and Rohit racing to a century stand in 15 overs.
Nathan Coulter-Nile (1-58) eventually removed the dangerous Rohit and Rahane followed his partner two overs later when he was trapped in front by Pat Cummins (2-54).
Pandya's promotion to number four paid off though as he helped Kohli (28) get India back on a track in a steadying 56-run stand, before the captain scooped Ashton Agar (1-71) to long-off.
Kane Richardson (1-45) then had Kedhar Jedhav (2) caught behind to make it two in five balls, but that was to prove Australia's list glimmer of hope as Smith's drop enabled Pandya to up the ante alongside Manish Pandey (36 not out) - the pair taking 18 off Stoinis (0-61) in the 45th over to put the result beyond doubt.
Pandya departed with 10 runs required when he tried to take Cummins down the ground, but MS Dhoni arrived to ensure victory.