Australia’s hopes of a Sri Lanka series whitewash are back up in the air after losing seven wickets in a batting collapse that left them all out before lunch on day three of the second Test.

Superstar batters Alex Carey (156) and Steve Smith (131) were both dismissed within an hour of the restart on Saturday as Prabath Jayasuriya (5-151) spearheaded the hosts’ rescue mission with the new ball.

The tourists had begun the day sitting pretty at 3-330 but were all out for 414 after the wicket finally started to play the tricks that had been expected ahead of day one in Galle.

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Australia would have had their eyes on a mammoth first-innings lead but went to an early lunch only 157 runs ahead.

Left-arm finger-spinner Jayasuriya had four of the seven wickets that Sri Lanka took inside 26.4 overs and just less than two hours.

First-Test centurion Josh Inglis (0), highly-touted debutant Cooper Connolly (four) and allrounder Beau Webster (31) all missed out on big scores amid the carnage.

Australia are still favourites for a second win from as many Tests but are likely to have to bat again, having hoped to get away with only one innings at stumps on day two.

A match-defining 259-run stand between Smith and Carey came to an end in the fifth over of the day when the stand-in captain caught an outside edge from Jayasuriya.

The usually-skeptical Smith had no choice but to walk, but he wasn’t the last man bamboozled by a deck now turning fiendishly.

Spin guru Inglis survived an LBW appeal on the first delivery he faced but lost his middle stump on the second as Jayasuriya had a two scalps in three balls.

Carey brought up 150 runs off only 175 balls, overtaking two knocks of 144 by Adam Gilchrist to set a new high-score for Australian wicketkeepers in Asia.

But he was bowled by Jayasuriya playing the reverse sweep shot that had worked so well on day two.

Veteran Sri Lankan batter Angelo Mathews shook Carey’s hand as he left the pitch having claimed the highest score of his first-class career.

Connolly could not live up to his billing as Australia’s shiny new toy, looking very shaky before clipping Nishan Peiris (2-94) to backward point.

When he bowled Mitch Starc (eight), Jayasuriya had his ninth five-wicket haul in Galle - finally living up to his reputation as one of the ground’s great bogeymen after an underwhelming first Test.

Webster overcame a shaky start with a handy cameo at No.7 but was bowled as a first scalp for slow-starting tweaker Ramesh Mendis (2-81).

Australia were all out in the final 10 minutes before lunch as Ramesh bowled Matt Kuhnemann (six).

Sri Lanka now have the tough task of facing up to the new ball themselves following a meek start to the series with the bat.

Of the Sri Lankans playing, only Kusal Mendis and Dinesh Chandimal (twice) have made scores above 50 in three innings so far.