Thirty inductees spread across all facets of the sport were welcomed to the Hall of Fame in front of a packed function room at the Melbourne Exhibition Centre.
The deputy team principal of Williams F1, Claire Williams, also attended, presenting Jones with a replica of his 1980 world championship trophy.
Event organisers Garry Connelly had the replica made to replace the original after it was famously stolen.
“I had no idea, honestly, it was such a shock,” Jones told Speedcafe.com of receiving the trophy.
“To me it's as good as the original. I can put it in the house and look at it and say ‘that's my world championship'.”
Claire Williams, the daughter of team founder Frank, paid tribute to the role that Jones played in establishing the squad in Formula 1.
“Alan really is a hero at Williams,” she said. “He's a role model for every Williams driver we've had since.”
Other Australian world champions recognised included the late Sir Jack Brabham and motorcycling greats Mick Doohan, Wayne Gardner, Casey Stoner, Troy Bayliss and Kel Carruthers.
Local touring car talent was also well represented, with Australian Touring Car Champions including Bob Jane, Dick Johnson, Allan Moffat and the late Peter Brock among others inducted.
Moffat made an emotional tribute to Brock during his acceptance speech, while also making special mention of former team-mate Colin Bond.
“Everyone thought we were great enemies but nothing could be further from the truth,” said Moffat of Brock.
“On the day he had his horrible accident (Brock's death on Targa West in 2006) I got 55 calls from radio stations asking what had happened to Peter.
“What happened to him is that he's gone to heaven.
“(Peter and Colin are) two great fellas that I'll love for life.”
Current V8 Supercars star James Courtney was also inducted thanks to his two world karting titles earned in 1995 and 1997.
“I can't believe that a little boy from Penrith can be mentioned in this sort of company,” he smiled.
While not among the inductees, nine-time Formula 1 grand prix winner and reigning World Endurance Championship title holder Mark Webber summed up the sentiment from the evening.
Webber was on hand to induct close friend Jason Crump, who won three world championships during a stellar speedway motorcycling career.
“The Hall of Fame is sensational,” said Webber.
“It's crucial that we have two and four wheels together. I had a lot of posters on my wall of two wheels as well as four.
“The motto out of the night for me is that we're all just Aussie battlers having a crack.”
Sir Jack Brabham – 3 time Formula 1 World Champion
Alan Jones – 1980 Formula 1 World Champion
Phil Irving – Designer, Repco Formula 1 World Champion Engine
Other Circuit Racing
Harry Firth – Bathurst Champion, patriarch, Holden Dealer Team
Bob Jane – Bathurst and Australian Touring Car Champion, Australian NASCAR founder, circuit owner
Peter Brock – 9 Times Bathurst 1000 Champion, 3 time Australian Touring Car Champion
Dick Johnson – 5 Time Australian Touring Car Champion and three-time Bathurst 1000 victor
Allan Moffat – 4 time Australian Touring Car and 4 time Bathurst 1000 winner
Frank Matich – Australian Open-Wheel and Motorsport Engineering icon
Lionel van Praag – 1936 World Speedway Champion – the first motorsport World Champion
Jack Young – 2 time World Speedway Champion
Jason Crump – 3 times World Speedway Champion
Kel Carruthers – 1969 250cc World Champion, Isle of Man 250TT Champion
Wayne Gardner – 1987 500cc World Champion
Mick Doohan – 5 times 500cc World Champion
Casey Stoner – 2 time MotoGP World Champion
Gregg Hansford – 10 times Grand Prix winner, Bathurst 1000 (touring car) winner
Troy Bayliss – 3 times World Superbike Champion
Stephen Gall – 5 times Australian Motocross Champion, 4 times Mr. Motocross, Australian Speedcar Champion
Jeff Leisk – World Junior Motocross Champion, 2 times Australian Motocross Champion
Ray Revell – 5 times Australian Speedcar Champion
Garry Rush – 10 times Australian Sprintcar Champion
‘Gelignite' Jack Murray – REDeX Trial winner, London to Sydney Marathon pioneer
Colin Bond – 3 times Australian Rally Champion, Bathurst 500 Champion, Australian Touring Car Champion
Ross Dunkerton – 5 times Australian Rally Champion, Asia-Pacific Rally Champion
James Courtney – 2 times World Karting Champion, V8 Supercars Champion
Ash Marshall – Australian Drag Racing Pioneer
Mark Burrows – 7 Australian Off-Road Championships, 5 Finke Desert Race wins
Norman ‘Wizard' Smith – Australian Land Speed Record Pioneer
Donald Kingsley Thompson – Co-Founder & inaugural President, Confederation of Australian Motor Sport