The dolphins have been identified in Victoria's Port Philip Bay, and can be found in waters right down to Tasmania.
Their discovery is cause for much celebration as it's only the third time since the late 1800's that a new dolphin species has been recognised.
PhD researcher Kate Charlton-Robb discovered the new species after comparing the animal's skulls to those of bottle-nosed dolphins.
Presenter: Kerri Ritchie
Speaker: Kate Charlton-Robb, Monash University PhD researcher
CHARLTON-ROBB: We're very pleased to announce that yes it is a new dolphin species and I have called it Tersiops Australis and with the common name of the boanan (phonetic) following Aboriginal narrative meaning large fish of the porpoise kind.
So that's the name of the animal. They're actually out in Port Philip Bay and Gippsland Lakes and coastal Victoria, and down to Tasmania and Southern Australia.
So we initially thought that they were one of two bottlenose dolphin species.
We had a look at their genetics quite some years back and started to see that they were very different from the two formally recognised bottlenose dolphins.
And we've now had a look at the skull morphology and the external characteristics of the animal and feeding ecologies and things like that.
And in every case we've found that they are very much differentiated from the other two bottlenose, so hence the new species.
RITCHIE: And what does it mean to have a new species out there in the bay?
CHARLTON-ROBB: Well it's a pretty exciting discovery because you know we've come a long with scientific advances.
But this animal has been living right under our noses for so many years and just with combining those two different technologies, with looking at the skull morphology and the DNA, you know there's still really exciting discoveries to be made.
Given that the population is in Port Philip Bay and Gippsland Lakes you know we really need to make efforts to conserve and protect these animals for future generations.
It would be a shame to discover something and then and lose it. So we really are working hard to try and protect and conserve these animals.
RITCHIE: Now you worked it out because of the skull so there's no way of me going out there today on a boat and saying oh that's the new species? I'm guessing it's a bit more complicated than that.
CHARLTON-ROBB: No you can pretty much, I mean chances are the animals that you come across in Port Philip Bay are the new species type.
We do have Tersiops truncatus which is the common bottlenose but they're more found in Bass Strait. And of the 12 years that I've been working on the water I've only ever seen those animals in Port Philip Bay once.
So the animals that you would see out in the bay on a normal occasion would be this new species type.
And they are a bit of a combination of the two formerly recognised bottlenose dolphins. They have gradation of grey colour patterning and what we call a falcate dorsal fin and a little snubby nose.
So you know they are quite distinct in what they look like.