"As I went to stamp my foot on them the flight attendants were already there with a bucket of water to pour on them. They put them into the bucket at the rear of the plane," she said.
The incident has prompted the Australian Transport Safety Bureau (ATSB) to issue a warning to the public reminding airline passengers about the dangers of battery-powered devices on flights.
The Bureau has not disclosed the name of the woman but has released images of her injuries to highlight the issue of lithium batteries on flights.
Photos of the woman show the side of her face and mouth covered in black soot from the explosion.
Her hair and eyebrows were singed and her hand blistered from the burn.
While she suffered the physical injuries from the unexpectedly combustible headphones, the other passengers in the cabin reportedly endured the smell of melted plastic, burnt electronics and burnt hair for the remainder of the flight.
"People were coughing and choking the entire way home," the woman said.
As the range of products using batteries grows, the potential for in-flight issues increases, the ATSB said in a statement.
The incident occurred during a flight on February 19 but was only recently reported to the government body.
A spokesman from the Bureau said the department was "not investigating" but wanted "to use the opportunity to promote safety" around the issue. He urged passengers to follow safety tips when it came to battery-powered devices on flights including storing them in your carry on baggage rather than checked luggage, where they are more accessible in case of "failure in flight".
At this point it is unclear what brand the woman's headphones were.
The episode comes in the wake of many airlines banning passengers from taking Samsung's Galaxy Note7 on flights due to issues with exploding batteries.
