It has received the green light by the Therapeutic Goods Administration, with Australia following the United States and countries in Europe to approve the therapy.
Until now, patients had been forced to travel overseas if they wished to access the treatment.
The next step is to ensure the therapy is affordable enough for eligible patients.
Pharmaceutical giant Novartis, which owns the therapy commercially known as Kymriah, is committed to working with the federal government to make it happen.
Health Minister Greg Hunt said he would work to make the therapy available in hospitals as soon as possible now it has been approved for use.
"It's (CAR-T) a breakthrough that deserves a Nobel prize," Mr Hunt told reporters on Wednesday.
"It means instead of just treatment for cancer, there is now the potential of curing cancers such as leukemia and lymphoma.
"We're working with the states to make sure that it is funded for treatment."
Novartis conducted two clinical trials, with 80 per cent of children showing no signs of cancer three months after treatment.
About 45 per cent of adults experienced a similar positive result.
"The TGA approval of Kymriah is a defining moment for patients in Australia with these aggressive blood cancers," Novartis Australia's Lauren Carey said.
"We are entering a transformative time in cancer care."