There had been rumours and hopes that pop superstar Kylie Minogue would represent her country's debut at the contest.
Australia was offered a wildcard entry to compete in the competition, while Australians will also be able to vote for their favourite performances for the first time.
However, organisers say that even if Australia wins, it will not host next year's contest, which will remain in Europe.
Guy Sebastian told ABC news that he was "pumped" to be performing at the competition in May.
"It's Eurovision, it's huge and keeps growing here in Australia which is nice," he said.
He said he was still unsure what song he would sing at the contest, but that he would consider singing a track from his newly-released album or write a new one.
"I want it to represent us as a nation well but also just be fun or be emotional. Either super fun or like a big ballad or something that showcases my voice."
Last year, Austrian drag queen Conchita Wurst, known as "the bearded lady", won the Eurovision title.
"With Eurovision, it's so eclectic, you never know what you are going to get. I'm not going to wear a dress," Sebastian said.
This year is the 60th anniversary of the competition.
The annual song contest is hugely popular in Australia - three million watched it in 2014.