The agreement comes just days after the latest round of the music industry's court battle with peer-to-peer file-trading company Sharman Networks, its executives and associated companies.
Under the deal, BigPond Music customers are to gain access to Universal's digital song catalogue, which includes artists such the Black-Eyed Peas, Eminem, Garbage, Portishead and Shania Twain.
Universal Music managing director, George Ash, said the BigPond music site had created a powerful new channel for artists to present their work and for music enthusiasts to obtain their favourite tracks in a "legitimate format".
"The exponential growth of online paid downloads is one of the fastest growing entertainment choices for consumers and we are proud to be working with BigPond Music to deliver content to our customers," said Ash.
Universal joins other leading record companies signed with BigPond Music, including Sony, Warner, EMI Festival Mushroom, along with a long list of independent and local record labels.
BigPond managing director Justin Milne said the BigPond music library will continue to grow, for the benefit of both the music industry and music fans.
"Every legal download means that artists are being rewarded for their time and talent," said Milne.
Tracks are available for download starting at AU$1.49 for BigPond account holders, or AU$1.89 for non-Bigpond customers.