Australia skipper Tim Paine admits his side missed out on a great chance to beat England after failing to build on a superb start with the bat.
Paine's side lost by six wickets to a red-hot England team after the hosts chased down 8-310 to move to within one match of a first ever whitewash against Australia in a five-match series.
Centuries from Aaron Finch and Shaun Marsh in addition to 62 from opener Travis Head put Australia in a strong position to put England under huge pressure to chase down a mammoth score.
But with only 83 runs added for the last 10 overs and just Ashton Agar (19) reaching doubled figures from the last seven batsmen, the hosts were able to get home comfortably at the Riverside ground in Chester-le-Street.
Led by in-form openers Jason Roy (101) and Jonny Bairstow (79) England got off to a flying start with the pair adding 174 for the first wicket.
Eoin Morgan (15) and Joe Root (27) fell to spin of Ashton Agar, but Jos Buttler slammed 50 from 29 balls with Alex Hales 34 not out to see their side home.
"We were probably 30 or 40 short. Shaun and Aaron batted really well but we didn't quite finish off," Paine said.
"I thought we were in the game for a patch, didn't quite execute up front and Jonny and Jason jumped all over it.
"We came here with an inexperienced side and while it's not an excuse, we're up against the best side in the world and they're red hot at the moment.
"We've got to keep learning and take things out of the game, this will hold them in good stead."
Finch, restored to the top of the order scored his sixth ton against England - with Marsh hitting his second century of the series.
The Victorian, who was dropped early in his innings on 8 after Alex Hales grassed a hugely difficult chance at shot mid-wicket, reached three figures off 105 balls.
Marsh smashed 21 from an Adil Rashid over, but that was as good as it got for the tourists in the latter stages of the innings.
A middle order collapse prevented the tourists from posting a mammoth total.
Mark Wood, who ended the innings of Finch, struck again two balls later when he bowled Marcus Stoinis for two to reduce Australia to 3-227.
Alex Carey (6) failed to make a big impression on his recall to the side when he tried to hit Willey out of the ground and Craig Overton took a smart catch in the deep.
Marsh brought up his ton with a huge six off Rashid before departing to a brilliant relay catch between Jason Roy and Overton.
Marsh looked well set for a fifth six of his innings only for Roy to flick the ball back into the hands of Overton.
Paine (3) and Michael Neser (2) also fell to Willey, who finished with figures of 4-43.
The sides meet for the final match of the one-day series in Manchester on Sunday.