Confirming the reports, the Geosciences, Australia said that Korumburra near Leongatha, Gippsland area, South east Melbourne was hit by earthquake.
The quake lasted for about 10 seconds, said The Age. No casualties have been reported till now, said the state emergency service.
An aftershock measuring 3.3 magnitude was reported 90 minutes after the earthquake and the Geosciences Australia said that the aftershocks could continue for a while.
Residents across Melbourne suburbs of Cheltenham, Sunbury, Scoresby and North Melbourne reported that they felt the tremors.
Korumburra, situated at the foothills of Strzelecki Ranges, Gippsland is an earthquake prone area.
Meanwhile, an earthquake of magnitude 6.5 was felt across both South and North Islands in New Zealand today.
According to media reports, the quake was largest in a decade to strike near Taupo. However no volcanic activity was reported near Lake Taupo and no causalities have been reported till now.