While hanging out her laundry, the ground opened and swallowed the woman – reported to be in her 50s.
The two-foot wide hole was three meters deep and it took neighbours 20 minutes before they heard her screams.
She landed in waist-heigh water which cushioned her fall.
Fortunately, the unnamed woman was not seriously hurt.
Firefighters in Melbourne, Australia, flocked to her rescue.
Paramedic Stephanie Palamberis told ABC Australia that her head was underwater at one point.
"The woman told us she was hanging washing out in the backyard at about 11.30am when the ground gave way," she said.
"She fell with the dirt and mud, dropping about three metres and landing in waist deep water."
Paul Carrigg, a County Fire Authority officer, said the rescue was complete just an hour later.
“This was a very unusual incident,” he said.
“Fortunately the lady has escaped without injury though she was obviously shaken up.”
He added: “We have doorknocked all residents in the street and advised them to stay indoors until council engineers investigate further.
