Casey Stoner took his first MotoGP pole position since the Qatar season opener in front of his home fans at Phillip Island on Saturday.
The Ducati star, winner of the Australian Grand Prix for the past two seasons, was fastest for much of the session - held in cool but dry conditions - but lost out to Valentino Rossi
with seven minutes of the hour remaining.
Stoner then snatched pole back from the reigning six time MotoGP champion by just 0.005sec with two minutes to go, having gained time on the Italian in the final sector. A cruising Rossi watched Stoner take pole on a big screen TV, but was unable to retaliate.
Stoner improved further on his final lap, but was still only 0.05sec clear of Rossi as the pair held a near 0.7sec advantage over the rest of the field.
In the post qualifying press conference Stoner "thanked Marlboro for allowing me to wear the new livery tomorrow" indicating that the 2007 world champion will wear special colours on Sunday.
Stoner, who finished second on his MotoGP comeback last time at Estoril, starts round 15 just three points behind third in the championship Dani Pedrosa.
Pedrosa - who suffered a fast fall from his Repsol Honda at turn two halfway through the session - returned to take the final place on the front row from Jorge Lorenzo
by just 0.001sec on his penultimate lap.
Lorenzo has been outpaced by Fiat Yamaha team-mate and title rival Rossi all weekend and faces a tough task to prevent Rossi extending his 18 point lead on Sunday.
Colin Edwards made it three M1s in the top five with a late fifth position for the Monster Yamaha Tech 3 team, denying San Carlo Honda Gresini's Alex de Angelis
of the top satellite spot. de Angelis saw his session interrupted by a fall in the closing stages.