Prime Minister Scott Morrison announced the ban, which is effective immediately, this morning.
Outdoor gatherings of 500 people or more were banned on the weekend as the federal government tries to curb the spread of the disease.
Airports and public transport facilities including stations, platforms and stops are considered essential.
Medical and health services and emergency service facilities are exempted from the ban, along with disability and aged care centres, which are subject to other restrictions.
Supermarkets, food markets, grocery shops, retail outlets and shopping centres will be allowed to remain open.
Parliaments, jails, courts, factories, construction sites, mines will also be able to continue normal operations.
Schools will remain open, with Prime Minister Scott Morrison pointing to Singapore as an example.
"In Singapore they have been quite effective in managing and limiting the transmission of this virus in that country," he told reporters in Canberra.
Chief Medical Officer Brendan Murphy said children had recorded very few instances of severe cases of coronavirus.
"We believe very strongly that it's in the best interests of our children and the nation at this time to keep schools open," he said.
Mr Morrison praised employers who had ensured employees were working from home during the pandemic.
TRAVEL ADVICE UPDATED
Australia has upgraded its international travel advice to the highest level, with all citizens being told not to travel overseas because of coronavirus.
Prime Minister Scott Morrison said it was the first time travel advice has been escalated to "do not travel" abroad.
"Do not go overseas. That is very clear, that instruction," he told reporters in Canberra on Wednesday.
"For those who are thinking of going overseas in the school holidays, don't. Don't go overseas."
Mr Morrison said the biggest risk of spreading the disease had been from Australians returning from overseas.
"It is very important that Australians do not travel abroad at this time," the prime minister said.
He said the ban on travel was indefinite, noting other countries had similar restrictions on arrivals.
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