Jack Roche, a 50-year-old Muslim convert, is the first man convicted under Australia's new anti-terror laws.
Roche dramatically changed his plea to guilty midway through his trial in a west Australian court last week after detailing links to al-Qaida and Jemaah Islamiya groups.
Prosecutors had sought the maximum sentence of 25 years for Roche, who told Perth's District Court during his 10-day trial he made a trip to Afghanistan in March 2000, when he met al-Qaida head Usama bin Ladin and underwent explosives training.
The government welcomed Roche's sentencing.
"The sentencing of Jack Roche today for a terrorist offence evidences the seriousness of the terrorism offences to which he pleaded guilty," Attorney General Philip Ruddock told reporters.
"These matters are of the upmost importance to the Australian community. It's a very serious offence and the penalty that has been applied by the court is significant," he said.
Roche could be released in as few as three years. Judge Paul Healy said Roche would be eligible for parole after four and a half years and back-dated the sentence to his arrest in November 2002.
The Hambali connection
Healy said sentencing had been difficult because there was no precedent for the case. He said while Roche had not initiated the plot, he had acted as a surveillance operative.
Defence lawyer Hilton Quail suggested Roche had already spent enough time in jail, where he was held for 18 months awaiting trial.
Roche had been charged with conspiring to damage or destroy the Israeli embassy in Canberra with explosives in 2000.
During his trial, Roche gave evidence of how he had agreed to carry out surveillance of targets in Australia for al-Qaida, but said he never intended to bomb the embassy.
The court was also told of his trip to Afghanistan via Pakistan. Roche named his al-Qaida contact in Pakistan as Khalid Shaikh Muhammad, a suspect in the September 11 attacks in the US.
Muhammad is now in US custody. Roche said he was sent to Pakistan by Hambali, a leader of the Southeast Asian group Jemaah Islamiya who police say funded the October 2002 nightclub bombings on the Indonesian island of Bali that killed 202 people, including 88 Australians.
Hambali is also in US custody.
The court was told the attack on the Israeli embassy was called off on the orders of Indonesian cleric Abu Bakar Bashir because of squabbling between Jemaah Islamiya members.
Bashir has been detained by Indonesian authorities over suspicions he had a role in the Bali bombings. He has denied wrongdoing and insists Jemaah Islamiya does not exist.
Roche was arrested in November 2002 amid heightened security concerns in Australia after the September 11 and Bali attacks.