The 32-year-old, currently playing for the Brumbies on loan from Japanese side Suntory, stepped down from international duty at the start of 2010 but has been brought back to counter the physical power of the Lions back row on Saturday.
Wallabies coach Robbie Deans said: "He's class, isn't he?
"To have achieved what George has throughout his career, and return to play at the highest level, after such a long break, is a testament to the quality of the man, both as a person, and as a player."
Smith, who has 110 caps and has captained Australia six times, may well have been involved from the start of the series but for a knee injury.
In the only change to the starting line-up for the decider, he comes in at openside for his fourth appearance against the Lions in place of Michael Hooper, who drops to the bench, pushing Australia Under-20s captain Liam Gill out of the matchday 23.
"The decision to go with George in no way reflects any dissatisfaction with the way either Michael or Liam have played," Deans says.
"But it has been a tough series - the first two games have been rugged, especially at the breakdown, and we feel that the combination of experience and fresh legs that George brings is the right way to go for this week.
"His expertise in the contact zone, where timing, judgment and physicality is everything, is going to be critical. Being able to call on George allows us to lighten the load on Michael while retaining the ability to inject him into what is sure to be a fast-paced and highly physical contest."
Also on the bench at ANZ Stadium will be Western Force loose forward Ben McCalman, with Rob Horne stepping aside.
Deans added: "Both sets of fans have been fantastic, the atmosphere in ground amazing, but with 80,000 seats available this weekend; this is our chance to drown out the sea of red.
"I encourage all Australians - both those going to the game and those watching it around the country - to get into gold and get behind your Wallabies."