Centuries to Annabel Sutherland (163) and Beth Mooney (106) powered Australia to 440.
Australia batted for less than an hour on Saturday, losing 5-18 after England responded well with the ball following a disastrous day in the field on Friday.
Mooney became the first Australian woman to score an international century in all three formats of the game.
The consistent star posted her first Test hundred, reaching the milestone from the final ball of the first over of day three.
Mooney was left stranded on 98 not out at stumps on Friday night.
But after five nervous balls to start Saturday, the 31-year-old hit a square drive to join Sutherland in piling on more pain to beleaguered England.
Mooney is just the fourth woman to post a ton in Tests, ODIs and T20s, after England pair Heather Knight and Tammy Beaumont, and South Africa star Laura Wolvaardt.
The left-hander has scored three ODI centuries and two in T20s.
Spinner Sophie Ecclestone (5-143) claimed three of the five wickets to fall on Saturday, putting a nightmare day two behind her.
England's Sophie Ecclestone picked up five wickets in Australia's first innings at the MCG. (James Ross/AAP PHOTOS)
Quicks Lauren Filer and Lauren Bell finished with two wickets each.
England have been their own worst enemy during this Test, putting down nine chances during Australia's 131 overs at the crease.
Sutherland was dropped twice early in her masterful knock, and Mooney was put down three times.
Star Ellyse Perry, who was replaced at No.3 by Sutherland, inexplicably came out to bat at No.10 despite Australia being so far ahead in the game.
Perry hurt her hip while fielding on Thursday and looked extremely sore during her brief batting stint.
Australia will secure the first 16-0 points whitewash since the multi-format series was introduced for the women's Ashes back in 2013 if they can win this Test.
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