The Queensland bowling allrounder made a mess of the tourists as India A crumbled to 5-64 at lunch, after Australia A captain Nathan McSweeney won the toss and elected to bowl first.
The situation could have been even more dire for India A after they had crumbled to 4-11 during a chaotic first 16 balls of the match.
Neser (4-16) was on a hat-trick in his first over after dismissing Abhimanyu Easwaran and Sai Sudharsan in consecutive balls.
Ruturaj Gaikwad avoided the hat-trick ball, but fell in Neser's next over.
In between, fellow Test contender Scott Boland removed KL Rahul, an option to play against Australia in the opening match of the Border-Gavaskar series, for just four.
The wickets tumbled so quickly that the scoreboard at the MCG and the online scorecard failed to realise Rahul had been promoted to open after he had initially been listed to bat at No.4.
Rahul was dropped for India's third Test defeat against New Zealand last week, arriving in Australia early to try and find some form for India A.
Boland spoke about Rahul on Tuesday: "He's obviously a world-class player, but he is someone we can hopefully get on top of pretty early and stay on top of him for most of the summer."
It only took three balls from Boland (1-22) - and four overall - to get Rahul out at the MCG.
Bowling allrounder Michael Neser did his Test chances a world of good against India A at the MCG. (James Ross/AAP PHOTOS)
Neser played the last of his two Tests in December 2022, but the 34-year-old's hot early season form gives selectors plenty to think about should pace stars Pat Cummins, Mitchell Starc and Josh Hazlewood are unavailable.
Boland hasn't played for Australia since the 2023 Ashes, but will also be in consideration for a call-up this summer.
McSweeney bowled first for a second-straight match after Australia A won in Mackay last week.
The South Australian captain has been promoted to opening the batting in this match as he closes in on a Test debut.
McSweeney fired with an unbeaten 88 in Mackay, putting him ahead of Marcus Harris, Cameron Bancroft and Sam Konstas in the battle to claim the vacant spot in the Australian XI.
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