Villeneuve makes a great start as Hill gets sideways in Turn 1 and drops to fourth. Brundle launched into the air at Turn 3 after Coulthard and Herbert tangle in front of him. The Jordan finishes in two pieces, inverted in the gravel trap, but Brundle quickly emerges unhurt. Race stopped.
Restart minus Herbert; Frentzen takes the spare Sauber, having parked up on the original warm-up lap. Brundle sprints back to get spare Jordan and, together with Coulthard, starts from the pit lane. Villeneuve gets away well to lead from Hill, Irvine and Schumacher.
Brundle an early retirement after a spin at Turn 3 on lap 2. Schumacher moves ahead of Irvine on the inside of Turn 13 to take third.
Villeneuve over a second ahead on lap 5 as Schumacher closes on Hill. Irvine and Alesi just about in touch and well clear of Hakkinen. Barrichello and Berger. Rosset spins at Turn 6 after contact with Lamy but keeps going.
Alesi attempts to go inside Irvine at Turn 3 on lap 10. The Benetton sustains bodywork damage from Irvine’s right rear wheel and limps into retirement.
Schumacher makes his first pit stop on lap 20. Rejoins in fourth.
Irvine, 18 seconds behind Hill, makes routine stop on lap 23 and comes out of the pits in seventh.
Berger, the only driver to compete in all 12 Australian Grands Prix, pits on lap 25, followed by Barrichello Coulthard, meanwhile, runs wide at Turn 15 and pits to retire.
By half-distance, lap 29, Villeneuve and Hill are 41 seconds clear of Schumacher, who has brake trouble
Villeneuve makes a slowish stop on lap 30 and rejoins in second, whilst Hakkinen dives in on lap 31. Hill now leads from Villeneuve, Schumacher, Irvine, Berger and Hakkinen.
HiII hits traffic and pits on lap 32, a lap earlier than scheduled. An 18.5s stop sees Hill rejoin just ahead of Villeneuve but the French-Canadian moves back into the lead at Turn 4 on lap 33. Schumacher pits, then locks up at Turn 3 on lap 34 and goes into gravel trap. He subsequently retires.
Hill puts pressure on Villeneuve and the latter slides onto grass at Turn 1 on lap 35. However, he collects the car and is able to rejoin without losing the lead.
Berger stops for the second time on lap 41 but still rejoins fourth, 46s behind Irvine.
Smoke from the rear of Villeneuve’s car seems to be increasing on lap 51 and gap closes to less than half a second.
The Williams pit hold up a ‘slow’ sign for Villeneuve and Hill moves into the lead as Villeneuve backs off with failing oil pressure.
Hill becomes the first man to win successive Australian Grands Prix at he takes the flag from Villeneuve, Irvine, Berger, Hakkinen and Salo.