Work by the team of researchers showed the fragment came from an axe that had been shaped out of basalt then polished by grinding it on a softer rock such as sandstone until it was very smooth.
Professor Hiscock said experimental work confirmed the smoothness of the basalt fragment could not have been achieved accidentally through natural processes.
He took basalt from the same area as where the artefact was found and rubbed it on sandstone.
"It took 800 double strokes to get the same smoothness [as the axe fragment]," he said.
"It's not the kind of thing that happens accidentally."
Professor O'Connor said the discovery showed early Aboriginal technology was not as simple as has been previously suggested.
"Australian stone artefacts have often been characterised as being simple. But clearly that's not the case when you have these hafted axes earlier in Australia than anywhere else in the world," she said.
Professor Hiscock said the find cast doubt on prevailing views around the dispersal of modern humans out of Africa.
He said it was believed that as modern humans dispersed "they maintained and employed a cultural system from Africa and used it everywhere".
"In evolutionary terms it is hard to imagine how one way of doing things works in every environment," he said.
Professor Hiscock said the Australian find supported the idea that modern humans employed "ingenuity and flexibility" as they dispersed.
"The moment people set foot on Australia we now have them adapting to survive," he said.
But, he said, the technology did not spread across Australia with humans as the earliest axes in the southern two-thirds of Australia date to about 3,000 years ago.
This suggested either two different colonising groups or that the technology was abandoned as people spread into desert and sub-tropical woodlands.
Professor Hiscock said these early innovations helped create cultural differences between groups.
"[The axe] is perhaps a material signal of cultural variations in the ancestors of Aboriginal people," he said.
The research appears in the journal Australian Archaeology.
Article first appeared on ABC Science Online.