University of Queensland palaeoecologist Dr Gilbert Price said researchers working in Central Queensland were amazed when they found that Australia's early human inhabitants and giant apex predator lizards had overlapped.
"Our jaws dropped when we found a tiny fossil from a giant lizard during a two metre deep excavation in one of the Capricorn Caves, near Rockhampton," said Price.
"The one-centimetre bone, an osteoderm, came from under the lizard's skin and is the youngest record of a giant lizard on the entire continent," Price said.
"We can't tell if the bone is from a Komodo dragon - which once roamed Australia - or an even bigger species like the extinct Megalania monitor lizard, which weighed about 500 kg and grew up to six metres long," Price said.
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The largest living lizard in Australia today is the perentie, which can grow up to two metres long.
Price said massive lizards and even nine-metre long inland crocodiles roamed Australia during the last Ice Age in the Pleistocene geological period.
"Humans can only now be considered as potential drivers of their extinction," he said.
The bone was found in what could be Australia's most fossil-rich site, with the Capricorn Caves housing millions of bones of many species.
Price said scientists could only hypothesise how the giant lizard bone made its way inside the cave, which contains bones of many rodents regurgitated by owls.
The research is published in Quaternary Science Reviews.