Starting second behind pole-sitter Hamilton, Bottas got the jump on the Briton during a typically messy start at Albert Park and ended up cruising to his fourth win by some 20.80 seconds after delaying a tire-change, Reuters reported.
Runner-up Hamilton, who switched to the medium compound tires seven laps earlier than Bottas, had to battle to hold off third-placed Max Verstappen and was fortunate the Red Bull driver took a late skid in the grass to lose vital seconds.
Bottas claimed his first race win since Abu Dhabi in 2017 and added icing to the cake by securing a bonus point for the fastest lap at the lakeside circuit in one minute 25.580 seconds.
“I don’t know what just happened. The start was really good, it was definitely my best race ever,” said the overwhelmed Finn.
“I just felt so good and everything was under control. The car was so good today so truly enjoyable, I need to enjoy today.
“I’m just so happy and can’t wait for the next race.”
A disappointed Hamilton said his Australian GP was "done and dusted" by the first corner as he was left searching answers after failing to match the pace of Mercedes teammate Bottas.
Hamilton, who was quickest in all three practice sessions and during qualifying, was gracious in defeat, but also struggling to know what went wrong, AFP reported.
"I had a pretty straightforward race today; I lost position at the start and my race was pretty much done and dusted after the first corner," he said.
"Afterwards it was really about bringing the car home and bagging the points.
"I had to pit early to cover the pit stop from Ferrari, so I had a long second stint and drove super carefully to make sure I had tyres left at the end of the race."
Autosport.com said Mercedes had discovered damage to the floor of Hamilton's car following post-race checks, possibly caused by hitting debris or running across a kerb.
Team chief Toto Wolff had no immediate answers.
"For Lewis, it was a harder afternoon – the start was not as good as Valtteri, then we had to pit him earlier than ideal to cover the risk of being undercut by (Sebastian) Vettel," he said.
"That gave him a long stint on the tires and none of us knew if they would make it to the end, so it was hard to judge the right pace and he wasn't happy with the car balance.
"My feeling is that it can be tricky to find the sweet spot with these new cars and tires, and probably we didn't manage that today with Lewis."
Despite not getting the win he as aiming for, Hamilton said it was "an incredible weekend for the team".
"I'll bag the 18 points I got today, keep working and come back recharged for the next one," he said.
"It was a really great weekend for the team and I'm really happy for everyone. We showed a great performance today and we need to continue to build on this – we have a long season ahead of us."