Background. In 2007 Australia experienced its first outbreak of highly infectious equine influenza. Government disease control measures were put in place to control, contain, and eradicate the disease; these measures included movement restrictions and quarantining of properties. This study was conducted to assess the psycho-social impacts of this disease, and this paper reports the prevalence of, and factors influencing, psychological distress during this outbreak. Methods. Data were collected using an online survey, with a link directed to the affected population via a number of industry groups. Psychological distress, as determined by the Kessler 10 Psychological Distress Scale, was the main outcome measure. Results. In total, 2760 people participated in this study. Extremely high levels of non-specific psychological distress were reported by respondents in this study, with 34% reporting high psychological distress (K10 > 22), compared to levels of around 12% in the Australian general population. Analysis, using backward stepwise binary logistic regression analysis, revealed that those living in high risk infection (red) zones (OR = 2.00; 95% CI: 1.57-2.55; p < 0.001) and disease buffer (amber) zones (OR = 1.83; 95% CI: 1.36-2.46; p < 0.001) were at much greater risk of high psychological distress than those living in uninfected (white zones). Although prevalence of high psychological distress was greater in infected EI zones and States, elevated levels of psychological distress were experienced in horse-owners nationally. Statistical analysis indicated that certain groups were more vulnerable to high psychological distress; specifically younger people, and those with lower levels of formal educational qualifications. Respondents whose principal source of income was from horse-related industry were more than twice as likely to have high psychological distress than those whose primary source of income was not linked to horse-related industry (OR = 2.23; 95% CI: 1.82-2.73; p < 0.001). Conclusion. Although, methodologically, this study had good internal validity, it has limited generalisability because it was not possible to identify, bound, or sample the target population accurately. However, this study is the first to collect psychological distress data from an affected population during such a disease outbreak and has potential to inform those involved in assessing the potential psychological impacts of human infectious diseases, such as pandemic influenza.