Galle - Skipper Angelo Mathews' gritty 47 helped Sri Lanka stretch their second innings lead to 318 after Rangana Herath bagged a hat-trick to rip the visiting batting apart in the second Test in Galle on Friday.
Sri Lanka were 143 for six at tea on the second day with the match moving at a brisk pace after witnessing the fall of 14 wickets in the first two sessions.
Dilruwan Perera was batting on 12 while Dhanajaya de Silva was giving him company on 19.
Mathews, the last batsman to fall before the break, was bowled by Nathan Lyon while trying to execute a reverse sweep but not before adding useful runs to the Sri Lakan lead.
Herath was the star for Sri Lanka after picking up his maiden Test hat-trick as Australia slumped to a record low of 106 in reply to the hosts' first innings total of 281.
Australia, who resumed at their overnight score of 54 for two, struggled throughout the morning session against both Herath and his fellow spin bowler Perera, the duo sharing eight wickets between them.
Off-spinner Perera bowled overnight batsman Usman Khawaja in his second over of the day before Herath took his first wicket by clean bowling the Australian skipper Steven Smith.
But it was Herath's seventh over of the innings which proved decisive as he dismissed Adam Voges, Peter Nevill and Starc off consecutive deliveries to put Australia on the mat.
The visitors also struck regularly in the Sri Lanka second innings with pace spearhead Mitchell Starc bagging three wickets on a flat pitch.
Starc, who bagged 5 for 44 in the first innings, kept coming back at the Sri Lankan batsmen as he was ably supported by Lyon from the other end.
The visitors face a massive task to save the Test and the series after Sri Lanka won the first of the three-match rubber in Pallekele.