Around 50,000-year-old axe fragment, about a size of a thumbnail was discovered in north-western Australia.
Archeologists say this might be the oldest of its kind.
"This is without doubt the oldest axe in the world," Peter Hiscock, the University of Sydney academic who analyzed the fragment, told AFP.
The small flake of basalt with weight of 0.16 g was unearthed from a rock shelter called Carpenter's Gap in the Kimberley region of Western Australia in the 1900s but its value was just recently recognized.
The findings about the fragment, was published in the journal Australian Archaeology.
They unburied the hatchet – scientists found and dated the world's oldest axe.
Archaeologists have deduced based on examining the piece that axe production was probably invented within Australia shortly after people arrived. It also means ancestors were good at creating the tools they needed.
"We know that they didn't have axes where they came from," Prof Sue O'Connor of the Australian National University told BBC.
O'Connor was among those who dug the fragment along with other artifacts.
"There are no axes in the islands to our north. They arrived in Australia and innovated axes," he added.
Another observation is that the axe might have been just a chip from the actual blade and it was just resharpened.
"Australian stone artifacts have often been characterized as simple. But clearly that's not the case when you have these hafted axes earlier in Australia than elsewhere in the world," she explained.
Axe blades made from harder stone are commonly found in discrete locations around the globe such as Australia and northern Asia.
Hiscock, said axes were only developed in Australia's tropical north. This could be a sign that there were two kinds of settlement in the area or that humans left the technology as they dispersed.
The discovery of the primitive piece leads to discovery of dispersal of humans and the nature of their occupation on Australia, the study says.
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