Australia were overwhelming favourites to win the series despite losing to India on the subcontinent in 2001 but the tourists showed their previous win was no fluke.
They scored a mountain of runs in every Test, including a record total of 705 for seven in the final match in Sydney, to show they have possibly the best batting line-up in the world.
Sachin Tendulkar and Rahul Dravid both made double centuries while VVS Laxman (twice), Saurav Ganguly and Virender Sehwag all scored hundreds.
India's performance has taken them up one place to fifth in the International Cricket Council (ICC) world Test championship behind Australia, South Africa, Pakistan and England.
Australian opener Justin Langer, who made two hundreds in the series, said India batted like they were in a "meditative state" while retiring skipper Steve Waugh said they had taught his team a lesson.
"The batting of India was sensational and the way they applied themselves was a lesson for all of us," he said.
SPECIAL TOUR
India's task was helped in part by an Australian bowling attack weakened by the absence of Glenn McGrath and Shane Warne and an uncharacteristically sloppy performance by Australia's fielders, who dropped 16 catches over the four Test series.
Yet they still were put under enormous pressure throughout stages of the series and responded to the challenge on almost every occasion.
"For us this was a special tour. It was a true test of our abilities and I think we stood up well," India skipper Saurav Ganguly said.
India have a terrible record playing away from home but Ganguly has pledged to change this by moulding a fiercely competitive team spirit.
Nowhere was this approach better shown than in the second Test in Adelaide when they pulled off a miraculous win after Australia had racked up a massive first innings total of 556.
Australia showed their own fighting qualities had not diminished when they won the third Test in Melbourne then batted through the last day to save the final match in Sydney and draw the series with Waugh signing off with a courageous 80.
While India's batsmen showed they were world class, the tourists' bowling lacked penetration, with the exception of leg spinner Anil Kumble who took 24 wickets for the series, including 8-141 in the first innings in Sydney.
Australia's vice-captain Ricky Ponting completed two double hundreds in his staggering series total of 706 runs, while Langer, Matthew Hayden and Simon Katich also reached triple figures.
MASSIVE VOID
Waugh's retirement will leave a massive void in Australian cricket although the departing skipper said he is confident the team will carry on under new captain Ponting.
"There's a lot of depth in Australian cricket and although teams are catching up I think they still can stay one step ahead," Waugh said.
"This was not a bad result for us. India are a quality side and it was a pretty level series. I don't think you can say either team was better than the other."
Waugh said the growing rivalry between Australia and India was starting to match the intensity of the traditional Ashes matches with England.
"The platform is there. The last two series have been phenomenal. India are going to be a very strong force in world cricket for a long time to come."
Dravid, named player of the series, said Australia remained the number one team in the world but India had shown they were catching up.
"I think this is definitely going to be a big boost for Indo-Australian cricket but also for Test cricket as a whole," he said.
