One-day international, Auckland:
New Zealand 337-5 (48.4 overs) bt Australia 336-4 (50 overs) by five wickets
South Africa have replaced Australia at the top of the one-day rankings after the world champions lost by five wickets to New Zealand in Auckland.
Taylor added to his growing reputation with a fine century
The Aussies, who have now lost four games in a row and five out of their last six, amassed 336-4 in Auckland.
Stand-in skipper Mike Hussey hit 105 and Brad Hodge an unbeaten 97.
But Ross Taylor replied with 117, while Peter Fulton (76no) and Craig McMillan (52) hit rapid fifties to clinch the series 2-0 with eight balls to spare.
It is the first time Australia have not topped the rankings since they were introduced in October 2002.
Missing captain Ricky Ponting and wicket-keeper Adam Gilchrist (both rested), and with several other key players out injured, they were hammered by 10 wickets in the opening game in Wellington.
But they responded with a record score at Eden Park, easily surpassing New Zealand's 304-5 against Sri Lanka 24 years ago.
They were contained at the start by Shane Bond, whose opening six-over spell conceded just seven runs.
Reserve keeper Brad Haddin chipped in with a useful 49 before Hussey and Hodge provided the acceleration with a partnership of 130 for the fourth wicket.
Hussey led by example but his team slumped to another loss
Hussey smashed his second ODI century off 81 balls, including eight fours and six sixes, three of which came in succession off part-time bowler Lou Vincent to move from 85 to 103.
Hodge was left stranded just short of his century after managing only a single off the penultimate ball but he and Cameron White (42no off 19 balls) crashed 82 off the last seven overs to end the innings with a real swagger.
New Zealand's chase started shakily when captain Stephen Fleming and in-form fellow opener Vincent fell cheaply to Nathan Bracken to make it 47-2.
Taylor dominated his partnership of 66 with Scott Styris, who never looked comfortable and departed for 17 in the 20th over to leave the Kiwis in some trouble at 113-3.
However, Fulton - drafted in after Jacob Oram broke a finger in the previous game - provided admirable support in a stand of 115.
The tall batsman brought up his half-century when White caught the ball but stepped over the rope to concede six runs.
McMillan blazed away with seven fours and two sixes in a breezy 30-ball knock before he was caught by Hussey off Shane Watson off a no-ball and then next ball off a legitimate delivery.
Brendon McCullum joined in the fun to crack 19 off 12 balls, help his team win the Chappell-Hadlee Trophy for the first time and consign Australia to another famous defeat.