After losing early wickets, Indian captain MS Dhoni slammed his 9th ODI ton as he helped his team set up a huge target of 304 for Australia.
The series that now stands at 1-1 will determine who is the ODI No1 team in the ICC rankings.
With both the previous ODIs being high scoring matches, this one was also in the same vein as Australia won the toss and elected to field first.
India were 156 for 6 when Dhoni came to bat and delivered as he blasted 139 off 121 balls and remained not out.
The Indian captain became the first Indian to score a century on the Punjab Cricket Association's (PCA) ground in Mohali where the third ODI is being played. Dhoni's unbeaten knock now has turned out to be the highest score at the venue.
On his way to the ton, Dhoni joined the likes of Mohammad Azharuddin and Sourav Ganguly to become the third Indian and seventh ODI captain to score 5,000 runs as team leader.
During his knock, the wicket keeper-batsman smashed 12 fours and five sixes. With vice-captain Virat Kohli who scored 68, Dhoni had a 72-run stand during the match and also combined with R Ashwin who made 28 to put up a 76 runs partnership.
Mitchell Johnson was the best Australian bowler with four for 46. Whether or not Australia manage to chase down the score will depend on their batsmen and the Indian bowlers but MS Dhoni played his part in ensuring that his team reached a defendable score.