Australia found themselves 144-8 at the close of play, an overall lead of 218, after the Proteas were bundled out for just 138 in the first session of play.
The Proteas started day two on 43-4 but showed more positive intent with captain Temba Bavuma and David Bedingham taking their overnight partnership up to 64.
Bavuma fell though, brilliantly caught at cover by Marnus Labuschagne, for 36 while Bedingham made his way to 45 as the Proteas collapsed from 125-5 to 138 all out to concede a deficit of 74 runs on the first innings.
Captain Pat Cummins led the charge for his team with figures of 6-28 and in the process achieved the 300-wicket landmark in his 68 Test match.
Australia did not fare much better with the bat as Kagiso Rabada once again took two wickets in one over, dismissing Usman Khawaja and Cameron Green, to leave Australia on 28-2.
Labuschagne edged Marco Jansen behind and when Lungi Ngidi trapped Steve Smith and Beau Webster lbw the Aussies were 64-5 and staring down the barrel.
Wiaan Mulder then bowled Travis Head before Ngidi did the same to Pat Cummins to leave the Aussies on 73-7, a lead of 147.
Alex Carey and Mitchell Starc then shared in a vital stand of 61 that took the lead beyond 200 but Carey fell just for the close, lbw to Kagiso Rabada for 43.
The day could have ended even better for the Proteas but Starc was dropped in the gully by Jansen off the bowling of Mulder, before the players walked off on a day that produced 14 wicket and 239 runs.
Aiden Markram believes South Africa's victory in the ICC World Test Championship Final has finally laid to rest the long-standing "chokers" tag - and hopes the Proteas' triumph can inspire a new generation to prioritise Test cricket.
Australia head coach Andrew McDonald believes batter Marnus Labuschagne has a big role to play for the Baggy Greens but conceded he has had a tough time of things over the past couple of seasons.
President Cyril Ramaphosa has congratulated the Proteas on winning the International Cricket Council's Test Championship against Australia.
Captain Temba Bavuma wants the Proteas to follow up their World Test Championship trophy success with a sustained a period of dominance in the longest format.
