A large blaze has been contained in Adelaide, South Australia after it burned through 2,500 hectares.
Neighbouring Victoria state is facing its worst fire risk in a year.
Temperatures in those states have started to cool but New South Wales and Queensland will see their heatwave continue into Tuesday.
Sydney recorded temperatures of above 40C by Monday afternoon.
Health officials have urged people to stay inside and to avoid physical activity, and for those near bushfires to avoid inhaling smoke.
The blaze in the Adelaide Hills has been contained but is expected to continue to burn for the next few days, local media reports.
It is believed to have destroyed several houses but has not caused injuries.
People in the area have been warned to take care.
"Smoke will reduce visibility on the roads and there is a risk of trees and branches falling," a statement from SA police said.
Images taken on Monday show smoke over Adelaide obscuring parts of the city skyline and prompting some residents to wear face masks.
After the hot spell began on Friday, the Bureau of Meteorology (Bom) issued heatwave warnings for South Australia, Victoria, New South Wales, Tasmania and Queensland.
On Monday, Victoria's state capital Melbourne recorded temperatures of 41.5C at 12.40pm (01.40 GMT).
People in Victoria have been urged to be careful when in water after the state recorded seven drownings over the past 10 days, ABC News reports.
The heat is expected to linger until mid-week as the hot air mass tracks east across the country.