England held their nerve to claim a breathtaking two-run victory at Edgbaston after Australia came within one shot of completing one of the most stunning comebacks in the history of Ashes cricket.

Facing almost inevitable defeat on the fourth morning when they resumed still 107 runs from an unlikely victory on 175 for eight, Australia came close to claiming a nail-biting victory - leaving the capacity 21,000 Edgbaston crowd almost breathless with the drama of the situation.

Steve Harmison's short ball into the ribs of last man Michael Kasprowicz was gloved to grateful wicketkeeper Geraint Jones, sparking jubilant scenes of celebration among the England team and their supporters.

Kasprowicz sank to his knees in despair having battled for an hour to add a crucial 59 runs with Brett Lee which had guided Australia to within one edge to the boundary of an incredible triumph at the start of that over.

While the rest of England's side hugged each other in celebration, man-of-the-match Andrew Flintoff went straight over to Brett Lee, who finished unbeaten on a determined 43 having been hit on the left hand and forearm by the England all-rounder, to console a fellow competitor after a thrilling duel.

This was Test cricket at its most compelling best and one only result - West Indies' one-run victory over Australia in Adelaide in 1992-93 - has been closer.

It sets up another eagerly-awaited meeting in the third Test at Old Trafford, starting on Thursday.

England captain Michael Vaughan said: "The nerves are there in that situation and there is not much advice on field placings for a captain when there are only 20 runs needed for them to win, but our lads showed character.

"They've played a good game under a lot of pressure against a good Australian side and it was great for Geraint to get the last catch - we've just got to produce two good performances back-to-back, that's the next challenge."

Before either side begin to start making plans for Manchester, however, they will be conducting post-mortems into one of the most exciting finishes to a Test in recent memory.

An expectant crowd had flocked to Edgbaston to witness what they believed would be a comfortable victory early in the morning session.

The view was shared by bookmakers Ladbrokes, who had England at 80-1 on to win and Australia 14-1 to complete one of the most stunning turnarounds in history.

But it was not just the bookmakers who began to get a little nervous during the first hour's play when Shane Warne, unbeaten on 20 overnight, teamed up with Lee and added a crucial 45 runs as England strove desperately to ease their own nerves with an early breakthrough.

Main spearhead Harmison - entrusted with the first spell from the City End - perhaps tried too hard during the early stages, enabling Warne to rock back and cut for the first boundary in the fifth over of the day.

That over ended up costing 13 runs, with Lee edging over the top of the slip cordon and then clipping off his legs for another four.

After his stunning display on the previous day, it was inevitable Flintoff would be given the responsibility from the other end and he delivered with the 56th ball of the morning - with Australian needing 62 more runs.

Warne had hit 42 off only 59 balls and with a 10-wicket match haul as well was rivalling Flintoff for the most influential performer in the Test when he stepped across his stumps to try and clip through square leg and ended up treading on his off-stump.

Delighted at the unexpected breakthrough the expectant crowd began to roar on England with even more gusto as last man Kasprowicz, who holds a Test batting average of 10.52, made his way to the crease.

But Kasprowicz moved to 18 before offering a chance as - with Australia needing only 15 for victory, Simon Jones, at third man, failed to take the crucial catch diving forward.

Flintoff allowed his next delivery to veer down the leg-side and fly for five no-balls after he over-stepped the crease - leaving Australia needing only nine more runs.

Just two overs later the target was just four - and when Harmison over-pitched from the first ball, Lee drove along the ground towards the cover boundary to prompt the few Australians in the crowd to begin celebrations, until they noticed Ian Bell in the deep restricting them to a single.

Kasprowicz blocked the next ball but then came the wicket which set off frenzied celebrations at 1210pm on a memorable afternoon.