Victorian Premier Daniel Andrews said there are now 18 cases in the state.
"We have 75 exposure sites, 1500 primary close contacts and 5000 secondary close contacts," Andrews said.
"I want to assure all Victorians that our contact tracers and public health experts, all the team are moving faster than they ever have, doing a brilliant job. I am very proud of them and grateful. As fast as they are moving, they are keeping pace with this virus, not getting in front. Unless we get in front, we won't drive these numbers down stop they will ultimately get away from us."
It will be the fifth lockdown since the pandemic began and the third this year.
"This will be a hard lockdown, similar to or identical to, what we did a couple of weeks ago," Mr Andrews said.
"If you are authorised to work then, you will be authorised to work now. If you were close then, you will be closed now.
"It is essentially a repeat of the successful strategy from couple of weeks ago.
"That was successful then and this will be successful now."
Mask rules were already tightened overnight to respond to the outbreak, which is now linked to 18 cases.
Prime Minister Scott Morrison this afternoon said that increased payments to individuals and businesses from week two of a lockdown would be proposed at National Cabinet tomorrow.
South Australia this afternoon announced greater restrictions on those travelling to the state from Victoria.
With Victoria's exposure sites ballooning to over 70, senior Victorian ministers and public health officials met yesterday to discuss the emerging outbreak and what restrictions may need to be reintroduced.
Most of the new cases have been linked to the Ariele apartments in Maribyrnong, where removalists from Sydney, who have since tested positive to Covid-19, were working on Friday, 8 July.
Authorities believe the other case of community transmission took place at Craigieburn Coles on Saturday, 9 July, where one member of a family that returned from NSW under a red zone permit visited. The person who picked the virus up at the supermarket is a man in his 30s.
A Bacchus Marsh school teacher, who lives at Barwon, also tested positive to Covid-19. A positive case was later registered at Barwon Heads Primary School.
Nancy Baxter from Melbourne University's School of Population and Global Health said the pace of the spread of the Delta variant could create real headaches for health authorities.
A service station and a Hungry Jack's outlet at Kalkallo, on the Hume Highway, have been added to the list of exposure sites.
"The infectious period for these people extended a week ago, which means they have been in the community for a significant amount of time when they potentially were infectious, so this is extremely concerning."
Last night, the state government announced the return of mandatory mask rules to be enforced from today.
Masks must be worn in all workplaces and secondary schools, and must also be worn outdoors when you cannot remain socially distanced from those who are not from your household.
Professor Baxter said the threat of the Delta variant should prompt health authorities to consider keeping the tougher mask requirements in place for longer.
"Given the number of outbreaks that seem to be happening repeatedly, I think it's something we're going to have to think about doing," she said.
"I think that we're all learning from Sydney about how rapidly the Delta variant spreads and how challenging it is for contact tracers to get a handle on it."
Victoria's Covid-19 response commander Jeroen Weimar yesterday said the coming two days were particularly critical.
"I think we're right on the heels of this particular outbreak," Weimar said.
"Can I please urge all of us as Victorians, we've talked … over the last few weeks about the outstanding performance collectively that all Victorians have undertaken, to get on top of these waves.
"We are being tested again now. This is a significant challenge to us, with two separate chains of transmission running."
Weimar said it was likely more exposure sites would be listed as Victoria also introduced tougher mask rules statewide.
"I need the whole community to once again come together to make sure we surge around these two chains of transmission and get them under control quickly," he said.
"We need to continue to work very closely with our red zone arrivals to make sure these flying embers don't catch light again.
"As we've always done in Victoria, we will take fast and aggressive action as we think it's appropriate."
With public health experts reviewing the situation in the wake of the new cases, Victorians will find out today if current restrictions will be tightened.
But Victoria's Opposition Leader, Michael O'Brien, warned against any further lockdowns, saying the state could not afford it.
"And that's the big test for contact tracing in Victoria," O'Brien said.
"If contact tracing has been fixed the way the government has promised it has been fixed, then there is no need for more restrictions and there should be no need for further lockdowns."
Yesterday, Weimer did not rule out any changes, urging Victorians to follow the current restrictions in place, including wearing masks and using QR codes to check-in.