Objectives To determine health impacts during, and following, an extended community lockdown and COVID-19 outbreak in the Australian state of Victoria, compared with the rest of Australia. Methods A national cohort of 898 working-age Australians enrolled in a longitudinal cohort study, completing surveys before, during, and after a 112-day community lockdown in Victoria (8 Julyâ€“ 27 October 2020). Outcomes included psychological distress, mental and physical health, work, social interactions and finances. Regression models examined health changes during and following lockdown. Results The Victorian lockdown led to increased psychological distress. Health impacts coincided with greater social isolation and work loss. Following the extended lockdown, mental health, work and social interactions recovered to an extent whereby no significant long-lasting effects were identified in Victoria compared to the rest of Australia. Conclusion The Victorian community lockdown had adverse health consequences, which reversed upon release from lockdown. Governments should weigh all potential health impacts of lockdown. Services and programs to reduce the negative impacts of lockdown may include increases in mental health care, encouraging safe social interactions and supports to maintain employment relationships.