In a decision that could well spell the end of the 34-year-old all-rounder's Test career, selectors have bitten the bullet and plumped for the rising West Australian as Australia attempt to hit back at Lord's after performing poorly in a 169-run defeat to England in Cardiff last week.

Watson's dumping is one of two changes to the Australian side for the second Test starting on Thursday, with veteran wicketkeeper Brad Haddin withdrawing for personal reasons and replaced by debutant Peter Nevill.

Mitchell Starc will start at Lord's if he pulls up without drama from a solid hit-out of bowling at training on Tuesday, having suffered an ankle injury in Cardiff, but Peter Siddle is on standby in the unlikely event the left-arm quick is a late withdrawal.

While the Australians were rocked on Tuesday by news that Haddin would be an absentee this week, the selectors have made a tough decision by promoting Marsh ahead of Watson.

The 23-year-old was in many people's eyes unlucky not to be in the XI for the first Test, having made back-to-back hundreds in the two tour matches against Kent and Essex, but will now add to his four Test caps earned during the past year against Pakistan in the UAE and against India at home.

His bowling has been a query but selectors could no longer deny a spot to a quickly emerging player who presented about as compelling an audition as possible with the bat in the lead-up to this series.

Watson, meanwhile, had done his hopes of retention no favours with the mode of his dismissals in Cardiff last week even though he was certainly far from the only player who misfired in a disappointing Australian line-up.

He was out lbw twice in the match, for 30 and 19, meaning he has been dismissed in that manner on 29 occasions in his career, and there is a feeling that England's bowlers simply know how to get him out. 

He had his nose in front of Marsh at the selection table in Cardiff due to his experience and the controlled bowling he offers as a fourth seamer, but he was only used as a bowler in a limited capacity there.

As for Marsh's bowling, Lehmann said at a function hosted by Hardys Australia at Lord's on Monday night that "only time will tell, won't it" if it can be a handy asset for Australia. 

"He's going to get his opportunity somewhere - there's no doubt about that in the future, whether it's this Test match or down the track," Lehmann said. "We've got to put him under the microscope and see how he goes."

While the younger son of former Test opener and Australian coach Geoff Marsh gets a deserved chance, it leaves a bleak outlook around Watson's Test future.

He was dropped for Marsh during the World Cup campaign for a group-stage game against Afghanistan in Perth, prompting suggestions he was finished as an international cricketer, but he was then recalled in the very next match against Sri Lanka in Sydney and went on to feature the rest of the way for Australia as they wrapped up the 50-overs championship against New Zealand in the final.

If Marsh can take his opportunity at Test level, however, it is hard to see a way back for Watson.

Starc, meanwhile, looked to be bowling without pain as he was put through his paces on Tuesday and Australia hope their most dangerous bowler in Cardiff will be fit to take his place here on Thursday.

Australia team for second Test: David Warner, Chris Rogers, Steve Smith, Michael Clarke (c), Adam Voges, Mitchell Marsh, Peter Nevill, Mitchell Johnson, Mitchell Starc, Josh Hazlewood, Nathan Lyon.