Australia's Prime Minister Scott Morrison has met national leaders for emergency talks on how to tackle a spike in Covid-19 infections.
An outbreak in Sydney linked to the highly contagious Delta variant has grown to 128 cases.
Cases have also been recorded in the Northern Territory, Queensland and Western Australia.
Officials say it is a "critical time". Australia has kept case numbers low with border closures and lockdowns.
Reports say the emergency meeting considered measures such as mandatory vaccinations for care home workers and new quarantine rules.
This is the first time in months that cases have emerged in multiple parts of the country at the same time.
"I think we're entering a new phase of this pandemic, with the more contagious Delta strain," Treasurer Josh Frydenberg told ABC News ahead of the meeting of the Covid-19 response committee.
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 five 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.
On Monday NSW Premier Gladys Berejiklian reported 18 new cases, down from the 30 reported the previous day. Nearly 59,000 people had been tested in the previous 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.
Dangerous variant exploiting Australia's weaknesses
Frances Mao, BBC News Sydney
Just a week ago Sydney was still in near Covid-free bliss - with people packed into restaurants and dancing in clubs.
But the swift spread of Delta has upended the "new normal". The strain is now linked to three of four clusters affecting Australia.
Experts say the nation's defences have been beaten, multiple times, by the powerful variant. It's breached hotel quarantine several times, raising concerns about air transmission.
It's also managed to break through relaxed distancing rules in society, latching onto unprotected workers. Mask-wearing is now back in almost every state in Australia.
In Sydney, officials say the virus is infecting 100% of household contacts when it's brought into a home. It's too early to tell if this lockdown will contain it, according to experts.
Low vaccination rates have also left Australians vulnerable.
One expert told me it's a "perfect storm" for "what is now easily the most dominant variant in the world".
NSW Health Minister Brad Hazzard has described the Delta variant which was first detected in India 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."
While the two cases in Western Australia have been traced to the Sydney outbreak, the positive cases in Queensland and the Northern Territory have been linked to people who became infected despite completing hotel quarantine.
The remote Northern Territory has recorded seven cases, prompting authorities to extend a lockdown of the local capital, Darwin, until Friday.
The Delta outbreak there had spread from a mining camp and now posed significant risk to the community, officials said.
"For the first time, we do have public exposure sites in the Northern Territory," said Chief Minister Michael Gunner.
Authorities are also on alert after a member of cabin crew staff for Virgin Australia worked on five domestic flights while infected with the Delta variant. The airline has contacted all affected passengers and crew.
Travel bubble suspended
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.
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.