Australia won the second test by 218 runs in Adelaide on Monday, having opened the series with a 381-run drubbing in Brisbane. (Agencies)
The third test starts in Perth on Friday at a ground where Australia have won the last six matches between the sides.
"The Australians have played a great brand of cricket," Vaughan, who captained England to a home series victory in 2005, told the BBC.
"If England are getting out playing the pull shot on a slow wicket, what's it going to be like at the WACA?
"I see a few technical flaws with England, but it's in their minds - unless they twist the mentality round, it's going to be 5-0."
Vaughan also said the senior players in the team needed to start pulling their weight.
"It's the worst case scenario, a horrible environment to be in when you start losing," he said.
"But the senior lads have to step up to the plate - Joe Root as a young player almost pointed the finger at the senior players and said 'lads, this is how you do it'.
"The senior players are the ones who have to get England out of the mess they're in."
Vaughan's gloomy outlook was shared by another former skipper Geoffrey Boycott, never one to mince his words when it comes to England's batting which has so far proved inadequate in four innings with only one of more than 200 runs.
"I've worked out that 50 percent of our wickets have been given away," Boycott told the BBC. "A lot of them are pulling and hooking and being caught at fine leg.
"You can't win a test match if you can't bat. If you don't make decent scores you don't give your bowlers a chance and that's the problem. We don't seem to have a mindset to stay in and make them bowl you out.
"We're playing like it's a 50-over match. It's crash, bang, wallop and out and that won't win test matches," he said.
Australia won the second test by 218 runs in Adelaide on Monday, having opened the series with a 381-run drubbing in Brisbane.