The border between Australia's two most populous states, Victoria and New South Wales (NSW), is expected to close after a peak in Covid-19 cases in Melbourne.
The outbreak in the capital of Victoria recorded hundreds of cases in the past two weeks – more than 95% of new Australian infections.
So far, the two states have kept borders open, even when others have closed them.
The closure, which begins on Wednesday, will restrict travel to allow carriers.
Victoria's Prime Minister Daniel Andrews said it was a joint decision with Prime Minister Scott Morrison and NSW Prime Minister Gladys Berejiklian.
"This is one of those precautionary measures – it is one of those things that I think will help us in broader terms to stem the spread of the virus," Andrews told reporters on Monday.
He gave no indication of when the border could reopen. Flying between Sydney and Melbourne – the state capitals – is usually one of the busiest routes in the world.
The three leaders said earlier that closing borders was not necessary, but the increase in cases spread locally caused alarm.
"This is unprecedented in Australia. We have not seen anything like it," said NSW premier Gladys Berejiklian.
Andrews said those who have had "unavoidable travel" can apply for permission to cross the border, including to work.
He acknowledged that the decision would have a significant economic and social impact, but said it was necessary, given "the significant challenges we face in containing this virus".
Victoria registered 127 new infections on Monday – her biggest daily increase since the pandemic began.
Daily rise in Victoria cases
Just a month ago, when no cases were reported in two days, state officials expected them to be close to containing the virus.
On Saturday, authorities enacted a "hard block" in nine apartment buildings in Melbourne – confining 3,000 people to their homes – after a set of cases was found.
Residents in at least 36 "hotspot" suburbs were placed in a separate block last week. Unlike those in the towers, they can leave the house to work, exercise, care and shop.
The military was also sent to help Victorian authorities conduct a test blitz. At least 20,000 people are being tested each day.
The outbreak is threatening Australia's relative success so far in suppressing the virus.
Despite the most recent peak, case numbers remain low compared to many countries. Since January, Australia has recorded 105 deaths and about 8,500 cases.