Victoria will lift its cap on overseas arrivals in the coming weeks, though fewer international students and farm workers will be accommodated than either industry sought.
Premier Daniel Andrews on Thursday confirmed the state would be increasing its weekly cap on international arrivals "very soon".
"We will get to a number that is agreed with the Commonwealth government and we'll get to a number that I think other states will be pleased to see," Mr Andrews told reporters.
"But that has to be done safely."
The state has been accepting about 1120 Australians per week since early December, when its hotel quarantine program resumed under a new agency, COVID-19 Quarantine Victoria (CQV).
Failures in the first iteration of the program were responsible for the state's second wave of COVID-19, which led to more than 18,000 infections and 800 deaths.
Due to the cap on arrivals, thousands of Victorians are stranded overseas, as are international students and seasonal farm workers.
"It is just not possible to be having tens and tens of thousands of international students come back at this time," Mr Andrews said.
"A bit like it's very challenging, in fact not really possible, to have tens and tens of thousands of seasonal workers come in this time."
The premier again defended the decision to allow more than 1200 international tennis players, support staff and officials to travel to Melbourne ahead of the Australian Open.
He said Tennis Australia was footing the spiralling bill - estimated at $40 million - to quarantine the contingent at three Melbourne hotels.
Mr Andrews also apologised to residents living next to one of the hotels after used PPE from overflowing biohazard bins ended up blowing into their apartment foyer.
He said a garbage truck "turned up late" at the View hotel on St Kilda Road and that arrangements were in place to ensure it did not happen again.
"We don't want to see that happen again and we apologise to local residents if there was any distress caused by it," Mr Andrews.
On Wednesday, Emergency Services Minister Lisa Neville, who is responsible for hotel quarantine, said the PPE was not linked to CQV.
"I want to be really clear about this, 100 per cent this is not CQV," she said.
Victoria recorded a 15th straight day without a new locally acquired case of COVID-19 on Thursday, while one person in hotel quarantine has tested positive in the last 24 hours. It is unclear if the case is related to the Australian Open.
It is also unclear whether positive test results from two Australian Open players and a support person on Wednesday have been reclassified as viral shedding.
Their cases were expected to be included in Thursday's official figures.
There have been seven COVID-19 cases linked to the tournament, which begins on February 8.
There are 34 active cases in the state, no increase from Wednesday.
Despite the lack of community transmission, Mr Andrews has implored Victorians not to attend Invasion Day protests on Australia Day.
"This is not a commentary on what people might be protesting about but it's no time to be protesting. It just isn't," he said.
"We've built something precious and unique, Victorians have, through their sacrifice and their commitment and their compassion for each other and we have to safeguard that."
Australian Associated Press