Despite pleas to politicians and authorities, and two coroner's inquiries in 2001 and 2003 concluding that Dawson should be charged, the 70-year-old former sports teacher and professional rugby league player lived a quiet life in the state of Queensland.
The cold case has gripped the nation and grew in momentum following the release of the critically-acclaimed podcast, The Teacher's Pet.
Since then homicide squad detectives had gathered new evidence and it is thought the police case will in part rely on two witness statements uncovered by Teachers Pet.
"We have solved homicides before without identifying the body", he said.
He thanked the public and the media for the "partnership" in investigating the case.
In a statement, the police said: "In 2015, detectives from the Homicide Squad's Unsolved Homicide Unit established Strike Force Scriven to re-investigate the circumstances surrounding her disappearance and suspected murder".
Describing it as a "voluminous" evidence brief, Fuller said the additional evidence - including two discovered through podcast - had "helped us tie pieces of the puzzle together".
Ms Dawson vanished following the painful disintegration of her marriage to her husband, whose extra-marital affair with a teenage student grew in intensity throughout 1981.
It was revealed that Chris Dawson went "quietly" with police following his arrest this morning, and that no new evidence was found during the September dig at the Bayview property.
His family said they were "disappointed" at the decision of the DPP.
"That information enabled New South Wales Police to get an arrest warrant for a 70-year-old man now living in Queensland", Fuller told reporters Wednesday.
Mr Fuller said finding Ms Dawson's remains was "not crucial to finalising the matter", however investigators had not given up hope of doing so. "Lynette Dawson's family has been advised of today's arrest and have requested privacy at this time".
"We're certainly hoping an interview with this 70-year-old man who's now in custody in Queensland will assist us with the outcome of where the body may be".
He continues to maintain he had nothing to do with his wife's disappearance.
"We have to also ensure Chris gets due process".
Lyn's family reacted with shock and relief.
Mrs Dawson's brother, Greg Simms, said he was "ecstatic" about the development.
"We've had a cry, we've cuddled, we're just completely over the moon that something has finally happened", he told The Australian.