England’s 303 for eight was their highest total in 20 one-day international innings, largely thanks to record-breaker Ian Bell’s superb 141, but Smith’s nerveless 102 not out in his first game as ODI captain helped Australia home with a ball to spare.
England were partial authors of their own downfall, setting a wonderful platform of 244 for two having been sent in by Smith only to lose six wickets for 59 in the last 10 overs.
Bell could not have done any more, scoring 15 fours and a six as he eclipsed Paul Collingwood’s career tally of 5,092 to become England’s top one-day run-scorer.
But Smith, deputising for both Michael Clarke and George Bailey in a depleted Australian line-up, had a wonderful response.
Smith has become increasingly comfortable with his status as Australia’s latest golden boy, hitting four centuries in as many Tests against India in recent weeks.
Opposite number Eoin Morgan has had a less enjoyable 24 hours, bagging a golden duck to follow Thursday’s revelations of a lurid blackmail plot against him.
England can still join their rivals in the Tri-Series final with victory over India in Perth, but by then Australia should be boosted yet further by the returns of Mitchell Johnson, David Warner, Bailey and Shane Watson.
With England having breached 300, the Australia reply needed to start well and Aaron Finch set the tone by punching Chris Woakes’ first ball to the cover boundary.
Shaun Marsh was even more assertive in Woakes’ next visit, threading three successive fours through the in-field.
The pair rattled off a stand of 76 before Finch aimed a mighty heave at Moeen Ali’s fourth ball and lost leg stump.
That gave England an opening and Steven Finn seized the moment with two wickets in his second over to make it 92 for three.
Marsh and Cameron White, recalled after one and four years respectively, were his victims, the latter bamboozled by an inswinging yorker.
Finn might have made it three wickets in six balls but Anderson grassed a sharp chance from Glenn Maxwell at short mid-wicket.
Smith was the authoritative anchor at the other end, calmly taking chunks out of the target and sharing vital stands of 69 and 55 with Maxwell and James Faulkner.
Neither man could last the distance, teased out by Moeen and Woakes, but Smith refused to let England off the hook with a knock of supreme concentration.
England needed wickets to get back on track, with Australia needing 100 off the last 86 balls then 50 from the final 41.
Brad Haddin, a long-time nemesis for England, took the hosts to the brink of success with 42 in just 29 balls but the tourists forced an exciting finale by removing the veteran.
Moises Henriques stalled with four in 11 balls before being run out by James Taylor, but Mitchell Starc got the winning run from the penultimate delivery.
England’s first innings was a mixed bag, with 40 good overs and 10 deflating ones that proved decisive.
Bell might have fallen first ball, reprising his golden duck against Mitchell Starc in Sydney, but once a loose first shot landed safe he was imperious.
He unloaded a series of early boundaries, including three in Starc’s second over, and carried on in a similarly commanding vein.
Moeen was a virtual passenger in the opening exchanges but exploded to life with three consecutive sixes off Pat Cummins.
The first crept over the midwicket rope, the second cleared it comfortably and the third was carried over the line by long-leg fielder Shaun Marsh.
England were 69 without loss after 10 overs – a major improvement on their 39 for four in the teams’ previous encounter.
The end of fielding restrictions stemmed the flow of boundaries but Bell’s intuitive ability to locate gaps ensured the hundred stand came at better than a run-per-ball.
Moeen fell for 46, deceived by Faulkner after stepping down the track, while Henriques ended Taylor’s inconsequential stay.
Bell’s only life came on 80, Brad Haddin grassing a thick edge off Faulkner, and he quickly reeled in Collingwood’s record and his own hundred.
He ran out of steam latterly, lofting Gurinder Sandhu to mid-off but only Joe Root offered meaningful back-up with a mature for 69.
Morgan’s troubles followed him to the crease as he nicked his first ball behind, Ravi Bopara was bowled woefully and Australia ended the innings with successive run outs.