"No matter how much they were unseen, their arrival was significant", said Chief of Navy Vice Admiral Ray Griggs.
He was speaking to dignitaries and submariners' descendants gathered for the centenary commemoration on the city's Garden Island base.
HMAS AE1 and AE2 were amongst the largest submarines in the world and at the cutting edge of technology.
Father of six children, Joseph William Wilson was the Chief Engine Room Artificer when the AE1 vanished a month after the declaration of war. His photograph is now prominent on a memorial plaque.
Decades on, Wilson's descendants have paid tribute to his role.
"[I'm] very proud to think that my grandfather was one of those men who set a world record in travel for submarines back in the day when they were very primitive machines", Paul Wilson said, wearing replicas of his grandfather's medals.
Nine descendants of Joseph Wilson attended the ceremony in Sydney.
The search for the AE1's final resting place will recommence off Papua New Guinea in September and will be timed to coincide with the anniversary of its disappearance.
However, the Navy admits finding the remains of the submarine and its crew will be a near impossible feat and narrowing the area for future search missions might be all that is achieved.
"It will be very difficult, because we have no co-ordinates. We don't know exactly where she went down," explained Navy historian Lieutenant Commander Desmond Woods.
"It's got to be modern technology versus lack of information and there's no guarantee of success whatsoever".
Extended interview with Lieutenant Commander Desmond Woods
