Human encephalitis in Australia causes substantial mortality and morbidity, with frequent severe neurological sequelae and long-term cognitive impairment. This review discusses a number of highly pathogenic zoonotic viruses which have recently emerged in Australia, including Hendra virus and Australian bat lyssavirus which present with an encephalitic syndrome in humans. Encephalitis surveillance currently focuses on animals at sentinel sites and animal disease or definitive diagnosis of notifiable conditions that may present with encephalitis. This is inadequate for detecting newly emerged viral encephalatides. Hospital-based sentinel surveillance may aid in identifying increases in known pathogens or emergence of new pathogens that require a prompt public health response.