Schapelle Corby, 27, wept as the verdict was announced. She could have faced the death penalty, but prosecutors requested a life sentence.
Corby's mother, Rosleigh Rose, yelled out, "Liar! Liar!" and had to be restrained in the front row of the courtroom gallery. Other relatives shouted, "We are going to get you home! We love you!"
Corby turned to her tearful parents and mouthed, "Just relax. It's OK."
Corby's case was closely watched in Australia, where actor Russell Crowe said last month that photographs of the beauty school student during her trial "broke my heart."
Australia had pressed Jakarta to avoid a death penalty and allow her to serve any prison sentence back home.
After the verdict was announced, the Australian government offered to send two senior lawyers to help Corby's appeal and said it would begin negotiating with Jakarta on a prisoner transfer pact.
"Guilty or innocent, I feel for this young woman," Prime Minister John Howard said. "I ask that we all pause and understand the situation and recognize and respect that when we visit other countries we are subject to the laws and rules of those countries."