The findings are based on the discovery of fossilised remains of an animal's skull, teeth and upper arm bone found in the Riversleigh World Heritage Area of remote north-western Queensland.
Riversleigh, located about 250 kilometres north-west of Mount Isa in Queensland, is one of Australia's most important fossil sites as it contains remains from ancient mammals, birds and reptiles from the Oligocene (33.9 to 23 million years ago) and Miocene (23 to 5.3 million years ago) epochs.
The meat-eating marsupial is estimated to have been about the size of a dog and weighed around 23 kilogrammes, the researchers said.
It is also closely related to the last surviving species of marsupial lion, Thylacoleo carnifex, which had enormous dagger-like fangs and the strongest bite of any known mammal species.
A new species of extinct lion that inhabited lush rainforest more than 18 million years ago has been discovered in the Australian outback.
Though that species survived until around 30,000 years ago, it is thought that the arrival of humans in Australia may be linked to its demise.
The Thylacoleonidae family of marsupial were categorized by their highly distinct large, blade-like, flesh-cutting premolars which were used to tear up prey.
The discovery comes just a year after the fossilised remains of a kitten-sized marsupial lion were found in the same fossil site in Queensland. The UNSW scientists named that miniature predator Microleo attenboroughi after BBC's animal documentary broadcasting legend Sir David Attenborough.
With this new find, the researchers believe that two different species of marsupial lion were present in the late Oligocene at least 25 million years ago.
The first identified species, Wakaleo pitikantensis, was found in 1961 near Lake Pitikanta in South Australia and weighed around 130 kg. The W. schouteni particularly the presence of three upper premolars and four molars which was attributed previously to the Priscileo genus.
Interestingly, the team also found structural similarities to another marsupial genus, the P. pitikantensis. Further similarities of the teeth and humerus which are shared with W. schouteni indicate that P. pitikantensis is a species of Wakaleo.
According to the authors, these dental similarities distinguish W. schouteni and W. pitikantensis from later species of this genus, all of which show premolar and molar reduction, and suggest that they are the most primitive members of the genus.
"The identification of these new species have brought to light a level of marsupial lion diversity that was quite unexpected and suggest even deeper origins for the family", Dr Gillespie said. The animal was named W. schouteni, in honor of palaeo-artist Peter Schouten.