Australia seized on a contentious challenge decision to grab a narrow innings lead over New Zealand on a drama-charged second day of the day-night third Test at the Adelaide Oval on Saturday.

Australia benefitted from the major talking point of the second day -- how Nathan Lyon survived a review in which 'Hot Spot' revealed a mark on the back of his bat before he had scored.

The review was churned over for minutes before the TV umpire Nigel Llong decided there was not enough to go on despite the Hot Spot evidence to give Lyon out, caught off spinner Mitchell Santner, with Australia reeling at 118 for eight and trailing the Kiwis by 84 runs.

Lyon walked three-quarters of the way off the ground believing he was out before he returned to continue batting and join in a record Australian trans-Tasman series 74-run ninth-wicket stand with Peter Nevill.

Lyon was eventually out for 34 to lay the platform for the Australians to profit from their good fortune to take an innings lead with incapacitated Mitchell Starc smashing two massive sixes off spinner Mark Craig.
Starc, who came into bat at No.11 after being diagnosed with a stress foot fracture on Friday, thrilled the home crowd with his prodigious hitting while rejecting any running between wickets.

Nevill was last man out for his highest Test score of 66 leaving the hobbling Starc unbeaten on 24 which included two sixes and three fours.

Doug Bracewell finished with three for 18 off 12.1 overs.

- Rough justice -

New Zealand's openers Tom Latham (10) and Martin Guptill (10) safely negotiated seven overs to go to the dinner break at 22 without loss and wipe out Australia's lead.

It was rough justice for the Kiwis, who trail 1-0 in the three-match series and have been on the receiving end of some controversial umpiring decisions.

New Zealand, unbeaten in their last seven Test series since 2013, will have to win the historic Test to draw the series after Australia won the Brisbane opener by 208 runs and last week's second Test in Perth finished in a high-scoring draw.

Australia were in dire trouble at 116 for eight at tea after a rampant bowling performance by the Kiwis in the first session.
The Kiwis snared Steve Smith's prized wicket nearing the interval when he charged off-spinner Craig only to be caught by wicketkeeper B.J. Watling to end the skipper's lone vigil as wickets tumbled around him.

The Kiwis had the Australians well on the back foot with Peter Siddle out four balls later in the same Craig over.

The Australians also lost the wicket of Josh Hazlewood, bowled off-stump by debutant left-arm spinner Santner for four in the final over before tea.

Just 62 runs were scored by Australia for the loss of six wickets in the first session off 29.5 overs in an astonishing turnaround in the pink ball Test.

Smith, who raised his fighting half-century off 108 balls, lost three batting partners before he fell.

Adam Voges looked flummoxed by Tim Southee's swing and after an edge that flew over the slips he edged to Guptill two balls later at third slip for 13.

Shaun Marsh, needing a big score to justify his Test recall, was run out for two by a brilliant piece of fielding from Kiwi skipper Brendon McCullum.

Marsh drove Southee to mid-off where McCullum made a sprawling save only to throw down the stumps at the bowler's end with the batsman well out of his ground.

Things got worse for the Marsh family when younger brother Mitchell was caught behind off Doug Bracewell for four off 25 balls leaving the home side struggling at 80 for five at first drinks.
Source: AFP