Australian Federal Police say one of the men, a 49-year-old from Sydney, brought the device to Sydney Airport on July 15th.
He put it in a bag that he asked his brother to carry on the flight without telling the brother that the bag contained explosives.
But for reasons still unclear, the bag never got past the check-in counter.
Instead, police say the man left the airport with the bag, and his brother got on the flight without it.
Australian Federal Police Deputy Commissioner Michael Phelan said, “This is one of the most sophisticated plots that has ever been attempted on Australian soil.”
Authorities say a senior ISIS member shipped the materials for the device via air cargo from Turkey to Sydney.
“It is concerning that it got through, yes, it’s hard to deny that,” Commissioner Phelan said.
After their plane plot failed, police say the two men changed tactics and were in the early stages of constructing an improvised chemical device.
The two men are charged with planning a terrorist attack.
At a court hearing Friday, their lawyer appeared on their behalf.
“At the moment all I can say is they’re entitled to the presumption of innocence,” their lawyer said.
If convicted, the men could face life in prison.
A third man remains in custody, while a fourth was released without charge.
The brother who was supposed to carry the bag of explosives onto the flight has not been charged because police believe he had no idea the bag contained explosives.