Two of those arrested are Americans: a 52-year-old man and a 46-year-old woman.
A US-based organised crime syndicate is being investigated over the shipment.
Five search warrants have also been executed in British Columbia in Canada where a significant amount of property, believed to be proceeds of crime, have been seized. Australian Federal Police (AFP) say they were found with "hundreds of thousands of dollars of proceeds of crime" during a raid in Melbourne.
U.S. authorities said the illicit cargo - with a street value of AUS$1.29 billion, or US$900 million - was hidden in two shipping containers carrying audio equipment bound for Australia.
The Australian Federal Police said the Victorian Joint Organized Crime Task Force was tipped off about a large-scale drug shipment from a suspected syndicate in California.
The meth alone would equal about 85 percent of all of the meth consumed in Victoria, Australia's second-most populous state, in the course of an entire year, according to figures provided by Jason Halls, the manager of Victoria operations for the Australian Criminal Intelligence Commission.
Dr John Coyne, head of the Border Security Program at the Strategic Police Institute, told Neil Mitchell "it's further evidence (international drug cartels) are expanding into our space for distribution".
It was reported to the federal authorities, who established a link between Australian bikie gangs and Mexican cartels. Every day, USA and Australian law enforcement officers work together to keep us all safe. "Along with our law enforcement partners here and around the world, we continue in a day-to-day battle against the blight of methamphetamine that continues to devastate our communities". Officials said the drugs weighed 1.7 tons.
Three of those arrested appeared at Melbourne Magistrates Court on Friday.
"Removing 1.7 tonnes of methylamphetamine before it reaches our streets will have a huge effect on the illicit drug market".
Authorities in Canada also conducted searches in Burnaby, British Columbia, as they attempted to crack down on the worldwide crime syndicate believed behind the smuggling.
"A seizure such as this not only helps protect the country to which the shipment was destined but has a positive impact on the global market as a whole", Finn said.
Investigations by Australian and global authorities are continuing.