Designed for low-speed urban environments, the driverless shuttle bus was developed in partnership with a EasyMile, a French company which specializes in autonomous automotive technology.
"Emerging transport technology is the next generation of opportunity and automation is a big part of that," Majid Sarvi, professor in transport for smart cities at University of Melbourne, told Xinhua.
"In Australia we missed a lot of opportunities with the dot-com and mobile boom, so that's why it's very important for us at Melbourne University to be one of the very first in the world to have this kind of collaboration in technology."
"By partnering with EasyMile through projects such as the University's Australian Integrated Multimodal EcoSystem (AIMES) - a world-first living laboratory based in the streets of Melbourne - we are able to test highly integrated transport technology that make a real difference to people's lives."
Fitted with open platform technology, the vehicle is able to be updated and improved by researchers as autonomous software advances.
"It has sensors in the vehicle that can detect the environment and then the shuttle bus is able to move within it," Sarvi explained.
"And you can program the destination very easily."
Melourne University's Vice Chancellor Glyn Davis said that having the autonomous vehicle on campus will give students and academics the opportunity to focus their research projects on real-life transport solutions to improve "safety, sustainability and reduce congestion."