The spin legend wore the cap during his 145-Test career, in which he took more than 700 wickets, and said he was blown away after a late bidding war pushed the price to $1,007,500.
It far exceeded the $425,000 paid at auction for the cap belonging to the legendary Donald Bradman when that was sold for charity in 2003.
“Thank you so much to everyone that placed a bid & a huge Thank you/ congrats to the successful bidder - you have blown me away with your generosity and this was way beyond my expectations,” he tweeted.
“The money will go direct to the Red Cross bushfire appeal. Thank you, Thank you, Thank you.”
The Commonwealth Bank, Australia's biggest lender, was revealed as the winning bidder.
Chief executive Matt Comyn said the cap would go on a tour of the country to raise more money before being donated to the Bradman Museum in Bowral, southwest of Sydney, where it will remain on permanent exhibit.
“I want to thank and commend Shane for giving up one of his most cherished possessions for such an important cause,” he said in a statement.
“He has demonstrated the same Aussie spirit we are seeing across the country with acts of generosity and dedication throughout this disaster.”
The “baggy green” is awarded to Australian players when they make their Test debut and is worn as a badge of pride.
Warne decided to put the cap up for auction on Monday (Jan 6) to help those who have suffered in the catastrophic fires that have devastated parts of the country and left at least 28 people dead, more than 2,200 homes destroyed and over1 billion animals dead.
“The horrific bushfires in Australia have left us all in disbelief. The impact these devastating fires are having on so many people is unthinkable and has touched us all,” he said on Instagram.
“Everyone is in this together and we continue to find ways to contribute and help on a daily basis.”
Lewis Hamilton has pledged US$500,000 to “support the animals, wildlife volunteers and rural fire services” affected by the bushfire crisis in Australia.
The six-time Formula One world champion announced the donation on Twitter on Thursday (Jan 9), saying: “It breaks my heart to see the devastation the Australian bushfires are causing to people and animals across the country.
“I'm pledging $500k to support the animals, wildlife volunteers and rural fire services. If you are able to, and you haven't already then you can donate too.”
The 35-year-old Briton's message was accompanied by a video of a koala bear being rescued from flames.
In a separate post on Instagram Hamilton wrote: “It saddens me deeply to know that over 1 billion animals in Australia died a painful death, no way out, not their fault.”
“My love of animals is no secret and I can't help but grieve for the defenceless animals thought to have died so far, pushing certain species closer to extinction.”
He urged Australia to “keep fighting.”
“I'm lucky enough to visit Australia often and I know first-hand how beautiful the country is.”
He said he had spoken to people “who are working at the heart of this and I'm filled with admiration for everything they are doing.”
And he concluded his heartfelt message by imploring his 14 million Instagram followers and fans “to join me in thinking about the impact we are having on our planet.”
“Let's work together to make small changes, and encourage our family and friends to do the same, so we can help shift the direction we're going in.”