Loud cheering and applause broke out from apartment buildings and in the streets the moment the city's sixth lockdown ended at 11.59pm on Thursday.
Melburnians dropped into pubs and restaurants to celebrate with a late-night drink or feed, while others headed to hairdressers for a much-needed snip.
Melbourne is considered the most locked-down city in the world, having endured 263 days under stay-at-home orders since March 2020. The latest lockdown lasted 77 days.
Premier Daniel Andrews agreed there was a "big vibe" of optimism around the city.
"I'm trying not to sound like some kind of soppy dad here, but I am proud, bloody proud of this state," he tweeted.
November 1 has also been marked as an important date for travel in Victoria.
Quarantine-free travel between the ACT and Victoria will be allowed from next month, as the state moves out of its COVID lockdown.
Fully vaccinated people will be able to freely move between the ACT and Victoria from November 1.
ACT Chief Minister Andrew Barr said the move would mirror quarantine-free arrangements between NSW and Victoria, which were announced on Thursday.
"We've already announced that as an intention, that we would follow NSW in that regard," Mr Barr said.
"And so, I think people can factor in November 1 as that date."
Victoria is also scrapping quarantine for fully vaccinated travellers arriving from overseas, bringing the state into line with NSW.
Premier Daniel Andrews on Friday confirmed travellers will no longer need to quarantine either at home or in hotels if they are fully vaccinated and test negative to COVID-19 before their flight and then 24 hours after arrival.
The change will come into effect on November 1, the same day as NSW.
"No hotel quarantine, no iso - you'll be able to go about your business," Mr Andrews told reporters.
"And the reason for that is that at 80 per cent, 90 per cent (fully vaccinated) - which is where we're going to get to - we are as protected as we can be." Children aged under 12 and those with a medical exemption will also not be required to quarantine.
About 250 unvaccinated people will be able to return each week but will need to quarantine at a hotel for 14 days.
AAP with The Project