Hanson, 49, sent shock waves through Asia with her anti-immigration rhetoric.
She and another party official, David Ettridge, 58, had denied fraudulently registering One Nation in 1997, and to obtaining almost €275,000 in electoral funds to pay for her campaign in the 1998 Queensland state election.
A Brisbane District Court jury found the pair guilty on all counts after more than nine hours of deliberations. Ettridge was also jailed for three years.
The conviction will probably bar Hanson from standing again for parliament.
She stood with her arms crossed, fighting back tears, as the sentence was handed down. The conviction looked like a final fall from grace for Hanson, a former fish and chip restaurant owner who once won a seat in federal parliament on a platform denouncing Asian immigration and welfare payments to Australia's impoverished Aborigines.
With her grab bag of populist political and economic remedies, Hanson's One Nation party won almost 10% of the vote in 1998 national elections and close to 25% in a state election in the same year.
But by 2001, she had failed to win a seat in the Australian federal Senate and her party broke up acrimoniously amid allegations of wrongdoing and internal bickering.
Recently, Hanson has quit One Nation and launched a new career promoting a country and western singer.
Hanson and Ettridge were accused of pretending that a list of more than 500 names used when applying to register One Nation with Queensland's Electoral Commission were party members.
Actually they were just supporters, prosecutors said. To get registered in Queensland, a party must show it has more than 500 members if it does not already have an elected representative.
Hanson and Ettridge, who had faced a maximum sentence of 10 years in jail, did not say if they would appeal.