Police in Australia's second-largest city of Melbourne have prepared for a fourth day of anti-lockdown protests after more than 200 arrests on Wednesday, while Covid-19 cases across the state of Victoria hit a daily record.

Hundreds of protesters have taken to the streets in the city of five million since officials earlier this week ordered a two-week closure of building sites and made vaccines mandatory for construction workers to limit the spread of the virus.

Police used capsicum spray and foam baton rounds on Wednesday to disperse protesters who gathered at a memorial honouring war service, prompting veteran groups and some politicians to speak out against using the shrine as a rally point.

As authorities brace for more protests, Victoria reports 766 new locally acquired cases, topping its previous pandemic daily high of 725 on August 5, 2020, and four new deaths. It reported 628 cases on Wednesday.