Oscar Jenkins, 33, was found guilty by a court of taking part in an armed conflict as a mercenary, said a statement on Friday from prosecutors in a part of eastern Ukraine controlled by Russia.
The court ruled he took part in combat operations against Russian troops between March and December 2024.
Mr Jenkins, a teacher from Melbourne, was serving with Ukraine's military when he was captured by Russian forces.
Both sides of politics offered bipartisan support for Mr Jenkins' return, urging Russia to abide by international law.
Foreign Minister Penny Wong said the Australian government was appalled at what she described as a "sham trial".
"As a full serving member of the regular Armed Forces of Ukraine, Mr Jenkins is a prisoner of war," she said in a statement.
Senator Wong urged Russian authorities to give Mr Jenkins the protections afforded to him as a prisoner of war, including treating him humanely in accordance with international humanitarian law.
"We are working with Ukraine and other partners, including the International Committee of the Red Cross, to advocate for his welfare and release," the statement continued.
Russia has previously expressed its view that foreign fighters serving with Ukrainian forces are mercenaries and can be liable to prosecution.
But international law experts say because Mr Jenkins was a combatant fighting on behalf of Ukraine, he would qualify as a prisoner of war under the Geneva Convention, entitling him to legal protection.
Opposition home affairs spokesman James Paterson described the situation as an egregious breach of international law.
"Russia is relying on, frankly, a unique reading of the law to arrive at the position that he could be treated any differently other than a prisoner of war," he told reporters in Melbourne on Saturday evening.
"He is a prisoner of war, he was fighting for the Ukrainian National Army, he was part of the Ukrainian Army and he's afforded all the protections of the Geneva Convention under that."
Senator Paterson said he was troubled by reports that Mr Jenkins would be sent to some sort of penal colony to serve out his sentence.
"That would be a shocking mistreatment, a shocking further mistreatment," he said.
Ukrainian Ambassador to Australia Vasyl Myroshnychenko has previously said his government added Mr Jenkins to its list of PoWs and would negotiate for his release in an exchange.
Prime Minister Anthony Albanese has also said Australia has made representations to Ukraine, including a one-on-one discussion he had with Ukrainian President Volodymyr Zelenskiy.
Victorian Premier Jacinta Allan said she stood ready to support the Jenkins family "who are no doubt going through a really difficult and challenging time".
"We stand ready to provide whatever support is required to both the family and the federal government as they work through what is a really difficult and challenging set of circumstances," she said in a statement on Saturday.
Mr Jenkins was captured in occupied eastern Ukraine and taken into Russian custody last December.
He was seen in social media videos visibly bruised and shaken while being interrogated and beaten by a Russian-speaking captor.
The 33-year-old is believed to be the first Australian combatant reportedly captured by Russian forces.
More than three years have passed since Russia launched its invasion of Ukraine on February 24, 2022.
