By the early 2020s, Australia needed to modernize its armored forces. In January 2022, a contract was signed for the delivery of 75 M1A2 SEPv3 Abrams tanks. The agreement included not only the tanks but also 29 M1150 Assault Breacher Vehicles, 18 M1074 Joint Assault Bridges, and six M88A2 Hercules armored recovery vehicles. This purchase was made through the Australian Department of Defense's tank fleet modernization program (LAND 907 Phase 2) and armored engineering vehicle acquisition program (LAND 8160 Phase 1).

The new M1A2 SEPv3 tanks entered service with B Squadron of the 3rd/4th Cavalry Regiment, which is stationed at the School of Armour in Puckapunyal, Victoria. The M1A2 SEPv3 tanks are intended to replace the 59 M1A1 SA tanks that Australia purchased from the United States in 2007.

The Australian M1A2 was introduced in Update 2.57 "Heavy Cavalry", as part of the British ground forces tree. This new Abrams variant primarily stands out for its improved turret and hull protection, allowing it to play more aggressively and better withstand damage from enemy APFSDS rounds. Its ammunition load now includes the new KE-W A2 APFSDS round, and the Abrams has received the "Camouflage Net" modification for better concealment on the battlefield. However, the tank's weight increased to 69.8 tons with the improved armor protection, negatively affecting its mobility.