Australia 85 for 2 (Khawaja 34*, Smith 23*) trail Sri Lanka 257 (Kusal 85, Chandimal 74, Starc 3-37, Kuhnemann 3-63, Lyon 3-96) by 172 runs

But despite the wickets of opener Travis Head and Labuschagne in consecutive overs, Australia will be satisfied to reach lunch at 85 for 2 on a very dry surface with cracks emerging.

There was intrigue over whether Sri Lanka's spinners would take the new ball, but lone quick Lahiru Kumara started and Head enjoyed the pace with three early boundaries.

Skipper Dhananjaya de Silva surprisingly decided to share the new ball having not bowled in the first Test due to a side strain. Bowling from around the wicket, he beat the outside edge of Khawaja with sharp spin in a sign of things to come.

Head rattled along at a run a ball pace until on 21 he used his feet to offspinner Nishan Peiris but was outdone by turn and a thick edge was taken at slip. All eyes were on Labuschagne, who only made 20 off 50 balls in Australia's massive 654 for 6 declared in the series-opener.

Having not scored a Test century since the 2023 Ashes tour, pressure is mounting on Labuschagne with his spot for this match attracting some attention.

Smith, wearing his baggy green, had a nervous start with a big lbw shout from Jayasuriya turned down as Sri Lanka burnt a review. Having made three tons in his last seven Test innings, Smith looked to counter the sharp spin by skipping down the pitch while Khawaja unfurled the reverse sweep to good effect just like he did in his double century last week.

They blunted Sri Lanka's spinners, but there were some nervous moments with Smith edging Jayasuriya just short of first slip moments before lunch.

Peiris was ineffective in the first Test with 0 for 189 off 41 overs and deemed fortunate to retain his spot over legspinner Jeffrey Vandersay. But he was far more dangerous in favourable conditions and bowled well in partnership with Jayasuriya.

Australia's three specialist bowlers Mitchell Starc, Nathan Lyon and Matthew Kuhnemann did the bulk of the heavy lifting and picked up three wickets apiece.

With Sri Lanka resuming at 229 for 9, Australia looked to wrap up the innings quickly amid stifling morning humidity. But they were left frustrated with Mendis thwarting Lyon's plans with superb sweeps that pierced numerous fielders on the leg-side boundary.

Lyon fired several uncharacteristic loose deliveries down the legside as Mendis lifted Sri Lanka past 250. He found a willing partner in Kumara, who in typical tailender fashion enjoys a slog but he knuckled down impressively and offered firm defence.

There were bizarre scenes when Mendis on 77 was given not out for a caught down the legside off Lyon. The Australians started to walk off after reviewing and so too a disappointed Mendis until the decision was upheld after no spike was detected on Ultra Edge.

Mendis had a century in his sights, but Kumara's resistance finally ended on his 26th delivery when he was well caught by Beau Webster at second slip to give Kuhnemann his third wicket.