The area stretches north into New South Wales, taking in Moama, Mathoura, Deniliquin, and Wakool.
Evidence of past exposure to the virus was detected in several 12-month-old dairy heifers in the area and the zone has been put in place for 30 days.
Victoria’s chief vet, Dr Charles Milne, said a Zone of Possible Transmission of 50 km and a further Buffer Zone of 50 km would remain in place whilst surveillance activities were undertaken.
Agriculture Victoria would undertake surveillance in cattle herds, over the next three weeks, to inform the longer term BTV status of the area.
"The purpose of the surveillance is to identify the potential source of the virus and determine if local spread of this insect-borne disease has occurred," Dr Milne said.
"Agriculture Victoria staff will be contacting producers in the area to seek their assistance and make arrangements for on-farm sampling of cattle.
"Both the zone and surveillance activities are essential for providing assurances to our international trading partners, and supporting Victoria's, and Australia's, valuable live animal export industry."
Whilst BTV was endemic in northern Australia, Victoria had previously been classified as being free of BTV.
Dr Milne said this had provided the live export sector with access to overseas markets requiring assurance of BTV freedom.
Under the changes, cattle and other livestock species situated in the zone would not comply with import conditions of countries requiring assurance of area freedom from BTV.
There were no changes to conditions for moving cattle from this zone to other parts of Victoria, or elsewhere in Australia.
Routine pre-export testing initially found antibodies in the animals' blood, which was subsequently confirmed by CSIRO's Australian Animal Health Laboratory.
The detection of antibodies indicated previous exposure to BTV.
The cattle were not showing signs of clinical bluetongue disease and no virus was detected in the animals' blood.
Clinical bluetongue disease has not been recorded in any livestock species in the field in Australia, with the exception of two minor incidents in sheep in Darwin in 1989 and 2001.
Bluetongue is a viral disease of livestock spread by flying insects known as midges. All ruminants are susceptible, including cattle, sheep, goats, buffalo, camelids and deer
There is no risk to humans from BTV, nor are there any food safety issue associated with livestock products.
Acting NSW chief veterinary officer, Therese Wright, said most producers in the zone “would not be impacted at all”.
She said it was believed to be a non-clinical case, and added that the alert was evidence biosecurity checks and measures were working.
“We’re simply being very up front – making sure export markets have confidence in our cattle,” Dr Wright said.
“Some (producers) we may contact to see if we can collect some samples. If they’ve got suitable home-bred cattle, we’d appreciate their co-operation.
“If they do have concerns suggest they talk to their Local Land Services (LLS) district vet or NSW National Arbovirus Monitoring Program (NAMP) coordinator at the Elizabeth Macarthur Agricultural Institute.”
Victoria was previously BTV-free, while only parts of Northern NSW were included in a transmission zone.
The NSW Department of Primary Industries said it was important to note antibodies could be present in animals which had previously lived in an area exposed to the virus.