Australian authorities have issued heatwave warnings for most of the country as millions celebrate Australia Day.

Temperatures are expected to peak on Tuesday, reaching the 'high forties' Celsius in the southern states of Victoria and South Australia, the Bureau of Meteorology said.

On Sunday, South Australia recorded temperatures as high as 48.5C, according to the bureau, which is warning of fire danger in parts of the country.

Some national day celebrations on Monday have been cancelled out of safety concerns.

Australia Day - 26 January - is the anniversary of the 1788 landing of Britain's First Fleet, which began the era of colonisation.

In Adelaide, an Australia Day parade and light show have been cancelled due to the extreme heat forecast.

'While this is deeply disappointing for the community, performers and partners, community safety and wellbeing must come first,' organisers said.

Aside from Victoria and South Australia, heatwave warnings have also been issued in New South Wales, Queensland, Tasmania, Northern Territory, and the Australian Capital Territory.

Many of these warnings will remain in place until Wednesday.

'We haven't seen heatwave conditions like this in Victoria for almost 20 years,' said Tim Wiebusch, Victoria's emergency management commissioner.

On Monday, the Bureau of Meteorology warned of 'extreme fire dangers' across parts of South Australia and much of south-western Victoria 'due to very hot and dry weather combined with moderate to gusty winds'.

Firefighters in Victoria are tackling several fires across the state, which have prompted evacuations and threatened properties.

The heat has also impacted the Australian Open at Melbourne Park. Tennis player Jannik Sinner was seen suffering from cramps on the court as play was temporarily suspended in the oppressive heat. Nearly 80,000 fans were alerted to take care under the scorching sun.

Meanwhile, parts of Western Australia were affected by Tropical Cyclone Luana over the weekend, resulting in damage to homes and a popular beach resort.

The meteorological bureau has advised residents to find cool places to stay, such as homes, libraries, community centers, or shopping malls. It also recommended keeping windows closed and drawing curtains to minimize heat inside homes.