Prior to 1913, all naval activities and forces in Australian waters were controlled by the British Royal Navy. In 1859, Australia Station was established as a separate command of the Royal Navy, responsible for all the waters around the Australian continent, in addition to the British and Australian colonial possessions in the South Pacific. It was at this stage that the forerunner of Commander Australian Fleet, Officer Commanding Imperial Squadron Australian Station, was created. Between the Federation of Australia and formation of the Commonwealth Naval Forces in 1901 to the year of 1913, the Royal Navy began a process of transferring all command responsibility in Australian waters over to the Australian Government, as well as replacing equipment and personnel with Australian variants. The Commonwealth Naval Forces were renamed to Royal Australian Navy in 1911. With the transfer complete in 1913, the position of Rear Admiral Commanding HM Australian Fleet was formed, with control over all naval combat operations and forces; the post was renamed Rear Admiral Commanding HM Australian Squadron in 1926. Despite this position being a command of the RAN, the majority of occupants were Royal Navy officers attached to, or on loan to, the RAN.
In 1949, Rear Admiral Commanding HM Australian Squadron was redesignated Flag Officer Commanding HM Australian Fleet. This was followed by a renaming to Maritime Commander Australia in 1988, and more recently to Commander Australian Fleet in 2007. Throughout its existence, the command has administered Australian naval forces as they have been deployed for duty in the First World War, Second World War, Malayan Emergency, Korean War, Indonesian Confrontation, Vietnam War, Operation Navy Help Darwin (1974-75), the Gulf War, War in Afghanistan and Iraq War, in addition to peacekeeping operations. The rank associated with this position today is rear admiral, however some of the earlier appointees held a different rank.
During the East Timor operations of 1999–2000, the then Maritime Commander Australia held the Task force designator Commander Task Force 627.