Egypt, meanwhile, must win while hoping that the other result in Group C goes in their favour in order to advance.
After beating Argentina 2-0 in their opening match, Australia's match against Spain almost became a free hit for Graham Arnold's side given the difference in quality between the two teams.
Indeed, Spain started six players who featured for the senior team on their way to reaching the semi-finals at Euro 2020, with one of their young contingent ultimately proving to be the matchwinner on Sunday.
Mikel Oyarzabal, who is the captain of Spain U23s at the Olympics, frequently had a positive impact when coming on from the substitutes' bench for Luis Enrique's side at Euro 2020, but the Real Sociedad forward demonstrated that he can last the distance, too, by scoring an 81st-minute winner against Australia.
Australia remain in the driving seat to finish second behind Spain in Group C, but they must beat Egypt to ensure their progression.
Egypt, meanwhile, secured an extremely impressive point by holding Spain to a 0-0 draw in their opening game, before narrowly falling 1-0 to Argentina on Sunday.
Central defender Facundo Medina, who plies his trade at Ligue 1 side Lens domestically, scored in the 52nd minute to take the game away from the CAF side, who generally look devoid of attacking threat without Liverpool's Mohamed Salah.
Ultimately, however, there is minimal pressure on head coach Shawky Gharieb's shoulders given that he has only selected one over-age player for this tournament, although that is also true of their forthcoming opponents on Wednesday.
Given how competitive they were against more illustrious nations in their opening two games, there is still every chance of Egypt pulling off an upset and advancing alongside either Spain or Argentina into the quarter-finals at Australia's expense.
Australia made no changes in terms of personnel against Spain, although Arnold did appear to switch from a 4-3-3 system to 4-4-2.
Marco Tilio will be hoping for a start in attack having scored from the bench against Argentina before coming on earlier in the 63rd minute against Spain, with Riley McGree potentially making way for the striker.
Ahmed Hegazi, who is Egypt's only player over the age of 24 competing at the Olympics, retained his place in the centre of defence against Argentina despite being involved in a nasty collision with Oscar Mingueza during the draw with Spain, and there are no signs of any lasting negative affects on the 30-year-old.
Australia Under-23s possible starting lineup:
Glover; Atkinson, Deng, Souttar, King; Wales, Genreau, Metcalfe, Arzani; Duke, Tilio
Egypt Under-23s possible starting lineup:
El Shenawy; Hamdy, Hegazi, Galal; El Eraki, El Fotouh, Ashour, Tawfik; Mohamed, Rayyan, Sobhi
We say: Australia Under-23s 2-1 Egypt Under-23s
We expect to see a close game between these two sides on Wednesday, with everything yet to be determined in Group C.
However, Australia showed a level of class during their surprise win over Argentina which Egypt are yet to at the Olympics so far this year, with Gharieb's side likely to go home happy enough if they can score their first goal of the tournament.