Each year, terrestrial ecosystems absorb more than a quarter of the anthropogenic carbon emissions, termed as land carbon sink. An exceptionally large land carbon sink anomaly was recorded in 2011, of which more than half was attributed to Australia. However, the persistence and spatially attribution of this carbon sink remain largely unknown. Here we conducted an observation-based study to characterize the Australian land carbon sink through the novel coupling of satellite retrievals of atmospheric CO2 and photosynthesis and in-situ flux tower measures. We show the 2010-11 carbon sink was primarily ascribed to savannas and grasslands. When all biomes were normalized by rainfall, shrublands however, were most efficient in absorbing carbon. We found the 2010-11 net CO2 uptake was highly transient with rapid dissipation through drought. The size of the 2010-11 carbon sink over Australia (0.97 Pg) was reduced to 0.48 Pg in 2011-12, and was nearly eliminated in 2012-13 (0.08 Pg). We further report evidence of an earlier 2000-01 large net CO2 uptake, demonstrating a repetitive nature of this land carbon sink. Given a significant increasing trend in extreme wet year precipitation over Australia, we suggest that carbon sink episodes will exert greater future impacts on global carbon cycle.