"In some of these cases it will be weeks before positive identification can be made," Victoria state premier John Brumby said, as the official toll was put at 181 but media said could reach as high as 300.

One razed town, Marysville, may have an additional 100 dead, said local media. Fire authorities fear that up to 100 of its 519 residents may have perished in the blaze that left only a dozen homes standing.

The town has been sealed off to the public because of the horrific scenes, Brumby said.

"The toll is going to be massive," said firefighter John Munday, who was in Marysville 10 minutes before the firefront swept through the town on Saturday night.

"We had people banging on the sides of our tanker begging us to go back to houses where they knew there were people trapped, but we couldn't because if we had, we'd all be dead too."

The fires tore through rural towns north of Melbourne on Saturday night, fanned by strong winds and heat wave temperatures. Melbourne's temperature on Saturday hit 46.4 degrees Celsius (115.5 degrees Fahrenheit), a record for the city.

The disaster area, more than twice the size of London and encompassing more than 20 towns north of Melbourne, has been declared a crime zone. More than 750 homes have been destroyed.

FIRES STILL RAGE

More than 4,000 firefighters are still battling some 33 fires in Victoria state, with 23 of those still out of control.

Victoria state police have launched the nation's biggest arson investigation, dubbed "Operation Phoenix," and have posted a A$100,000 reward for the conviction of anyone for deliberately starting the fire.

The tragedy is the worst natural disaster in Australia in 110 years. The previous worst bushfire was the Ash Wednesday fires of 1983 which killed 75 people.

The fires have increased pressure on the Prime Minister Kevin Rudd to take firm action on climate change as scientists blamed global warming for conditions that fuelled the disaster.

Australia is particularly vulnerable to climate change because of its hot, dry environment, but dependent on coal-fired power, Rudd has set a target to cut overall greenhouse gas emissions by only 5 percent by 2020.

Australia is the most fire-prone country on earth, say scientists, and most of its bushfires are ignited by lightning. Fire officials monitor lightning strikes and any fire that does not correspond with a strike is assumed to be started by people, either accidentally or deliberately.

Victoria has ordered a Royal Commission of Inquiry to probe all aspects of the bushfires, including safety guidelines.