A Covid outbreak in Sydney linked to the highly contagious Delta variant has grown to 128 cases.
A small number of positive infections have also been recorded in the Northern Territory, Queensland and Western Australia.
This is the first time in months that cases have emerged in multiple parts of the country at the same time.
State and territory leaders will meet Prime Minister Scott Morrison on Monday for an emergency meeting.
Treasurer Josh Frydenberg said Australia is facing "a critical time" in its fight against Covid, as various states shut borders and enforced new restrictions to prevent further spread of the virus.
"I think we're entering a new phase of this pandemic, with the more contagious Delta strain," Mr Frydenberg told ABC News on Monday.
The escalation in Covid infections has prompted lockdowns in the cities of Sydney and Darwin, as well as restrictions across four states.
The situation remains most concerning in Sydney, where some 5 million residents are subject to a stay-at-home order.
The New South Wales (NSW) state government on Sunday expanded a lockdown to cover all of Greater Sydney, the Blue Mountains, Central Coast and Wollongong.
Many businesses and venues have been ordered shut.
NSW Premier Gladys Berejiklian on Monday reported 18 new cases, down from the 30 reported the previous day. Nearly 59,000 people had been tested in the past 24 hours.
"We have to be prepared for the numbers to bounce around and we have to be prepared for the numbers to go up considerably because with this strain, we are seeing almost 100% of transmission within households," she said.
While the two cases in Western Australia has been traced to the Sydney outbreak of the Delta variant, clusters in Queensland and the Northern Territory have been linked to people who became infected despite completing hotel quarantine.
The remote Northern Territory recorded four cases on Sunday, prompting a 48-hour lockdown in the capital, Darwin, and two other towns.
Meanwhile, Virgin Australia said on Sunday it had contacted passengers and crew on five recent domestic flights, after a crew member tested positive in Melbourne.
The outbreaks have prompted some inter-state and international border closures.
New Zealand paused its quarantine-free travel bubble with all of Australia until at least Tuesday because of the latest outbreak.
The travel corridor between the two neighbours was opened in April. Travel between New Zealand and specific Australian regions has been closed for short periods as outbreaks emerged, but this is the first time the bubble has been shut with all of Australia.
Australia has maintained very low rates of Covid transmission throughout the pandemic due to a closed-border policy, stringent quarantine and swift testing and tracing systems.
It has recorded no deaths this year, but 910 deaths and 30,450 cases overall.
The newer, more infectious Covid variants however, have strained the nation's defences - with several small outbreaks this year.
NSW Health Minister Brad Hazzard has described the Delta variant as a "very formidable foe".
"No matter what defensive steps we're taking at the moment, the virus seems to understand how to counter-attack," he said.
Sydney's outbreak first emerged two weeks ago in Bondi, the famous beach suburb, before spreading rapidly across the city.
Its origin has been linked to an unvaccinated driver who transported international arrivals from the airport.
The NSW government has urged people to get their vaccine - noting that in one of the Sydney clusters, 24 of 30 people at a party became infected and those who didn't had been vaccinated.
"If you're vaccinated, you are much more likely to not be infected with COVID-19," Mr Hazzard told reporters on Monday.
The recent outbreaks have renewed criticism of the nation's slow vaccination rollout - which falls under the federal government's purview.
So far, just under 5% of Australia's adult population have been fully vaccinated under a phased rollout, and roughly 30% have received a first dose of either the Pfizer or AstraZeneca vaccine.
However, significant levels of hesitancy have been recorded around the AstraZeneca vaccine due to its link to a rare blood clotting syndrome. Meanwhile, Pfizer supplies have been limited to certain age groups.
Government critics have argued that cities would not need to endure lockdowns if a majority of the population was vaccinated.
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