Hundreds of cases have been reported across three states and a territory, with a dip in vaccination rates blamed for the spread of the generally rare respiratory disease.
Authorities have urged people to check they and their families are up to date with their vaccinations.
"When vaccination rates fall, serious diseases, which we had largely eliminated, can make a comeback," Australian Medical Association President Danielle McMullen said.
"We are seeing that risk play out with diphtheria."
There were 226 recorded diphtheria cases in the Northern Territory, Queensland, South Australia and Western Australia on Wednesday, up from 223 on Tuesday.
Almost all the cases have involved Indigenous Australians, prompting health authorities to work with Aboriginal agencies to try to curb the outbreak, including the provision of vaccines.
Federal Health Minister Mark Butler said the current outbreak was about 30 times greater than the average number of diphtheria cases nationally over the last five years.
"It is a very, very concerning outbreak," he told ABC News.
WA Health Minister Meredith Hammat said the outbreak, which grew by three cases from 79 to 82 overnight, was centred in the Kimberley region.
"We are taking the outbreak in the community very seriously," she said.
Public health officials are on the ground conducting contact tracing in the areas where cases have been recorded.
"We're doing everything we can to, in fact, not just limit it, but bring it to an end."
Diphtheria is a serious bacterial infection that can affect the nose, throat, airways or skin.
In severe cases, respiratory diphtheria can obstruct breathing, and the toxin can cause life-threatening complications, including heart and nerve damage.
The Australian Immunisation Handbook recommends routine vaccination as a primary course for infants and routine boosters for adolescents and adults in certain circumstances, because vaccination remains the strongest protection against this preventable disease.
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