Meares stormed around the Hisense Arena to post a time of 33.010 seconds and eclipse the previous mark of 33.296 set by Simona Krupeckaite of Lithuania in Pruszkow, Poland in 2009.
It was Meares's second world record at her home championships, the 28-year-old also setting a new mark in a flying 200 metres lap in the first qualifying session of the women's sprint.
"I won my first world title in this event in 2004 ... I can't be too disappointed with that," she said.
"I love this event. For me, it's just such enjoyment. There's no-one else to get in my way for starters, and it's pure speed and it suits pure control.
"I love this event and if I could have ridden it every single year, even though it's not Olympic, I would have," added Meares, who skipped the event in Apeldoorn last year to concentrate on her successful bid for sprint gold.
Meares set a world record to win gold in the event at the 2004 Athens Games before it was stripped from the Olympic programme.
The win gave Meares her 10th world title and her second at the Melbourne championships.
Meares defended her keirin title on Saturday after tearfully losing her sprint title to arch-rival Victoria Pendleton the night before.
"This was where I won my first world title eight years ago in the same event. Tonight I walk away with my 10th world title," she said.
"This is a totally special, pressure-off, go out and have some fun event."
Britain's Jess Varnish, who disappointed when finishing fourth in the team sprint with Pendleton, took bronze.
Britain claimed another medal with Wendy Houvenaghel winning individual pursuit silver.
She was beaten by former champion, New Zealand's Alison Shanks, in a re-run of the 2010 Commonwealth Games final to make some amends for her failure to make the gold medal winning women's team pursuit starting line-up.