Kumar Sangakkara hit an unbeaten half-century Saturday in his 100th test match, leading Sri Lanka's strong reply of 166-2 to Australia's 316 all out at stumps on the second day of the third test.
Sangakkara finished on 61 off 125 balls, hitting nine boundaries for his 36th test half-century. He shared an unbeaten 69-run third wicket partnership with Mahela Jayawardene (31) in Sri Lanka's first innings.
Sri Lanka trails Australia by 150 runs with eight wickets in hand.
Sri Lanka coach Rumesh Ratnayake said his team had learnt from the defeat in the first test, before drawing the second test.
"I felt we were much more aggressive, much more specific in what we wanted to do," Ratnayake said. "You can't get a better stepping stone than this. 166 for two is fantastic so we are in a very strong situation."
Opener Tharanga Paranavitana was out in the final session for 46, caught by Ricky Ponting at short extra-cover off seamer Mitchell Johnson. His opening partner Lahiru Thirimanne was bowled by Peter Siddle for 28.
Mike Hussey top scored with 118 in Australia's innings in his second century of the series. Sri Lanka seamer Shaminda Eranga took 4-65 on his debut.
Australia resumed the second day on 235-5, with Hussey on 63. Eranga led a spirited Sri Lankan attack in the morning session, taking two wickets as Australia's last four wickets fell for just 51 runs.
Eranga quickly put the pressure on the visitors with the fifth ball of his first over of the day when Brad Haddin was caught behind by Prasanna Jayawardene for 35 runs.
Left-arm seamer Chanaka Welegedara took two wickets in successive balls, having Johnson caught by Rangana Herath and Siddle caught by Paranavitana at slip. Two overs later, Trent Copeland endured the same fate, this time Mahela Jayawardene taking the catch.
Eranga then ended the Australia innings by bowling Hussey after the left-hander had faced 178 balls and smashed two sixes and 12 boundaries. Hussey scored his 15th test hundred, following up his top score of 142 in the second test and 95 in the first.
"The first innings at Galle really stands out at the moment because of such challenging conditions and to get us to a great position to win the first test," Hussey said.
Shaun Marsh, who batted at No. 3 ahead of regular Ricky Ponting, scored 81 after getting 141 on his debut in the second test.
Australia leads the three-test series 1-0.
"If we can bowl very well [Sunday], restrict them and take the wickets, it's going to put us in a great position to win," Hussey said. "If we can't get rid of Kumar and Mahela they are going to give themselves every chance to win the test match."