UPDATE: The Australian Open will continue on without fans from midnight Friday after it was announced that Victoria will head back into lockdown to curb the spread of the Holiday Inn outbreak.
EARLIER:The Victorian government has approved plans for the Australian Open to host 25,000 to 30,000 fans each day when the tournament begins on February 8.
Attendance will be capped at 30,000 spectators for the first eight days of the event before being reduced to 25,000 once the quarter-finals begin.
Minister for Sport Martin Pakula confirmed the news on Saturday and is hopeful the crowd can still have a big impact on the Australian Open despite being half the usual number.
"Over the 14 days, it means we will have up to 390,000 people here at Melbourne Park, about 50 per cent of the average over the past few years," Pakula said.
"Rod Laver Arena will have an incredible atmosphere, not that different to the atmosphere we’ve seen at all the Opens in the years past.
"It will not be the same...but it will be the most significant international event with crowds that the world has seen in many, many months.”
A number of tennis stars have complained about having to quarantine for 14 days upon their arrival in Australia with American Tennys Sandgren recently hitting out at Tennis Australia.
Rafael Nadal, who returned to the court with a win on Friday night in Adelaide, has however praised Australia's handling of COVID-19 and believes the rest of the world should take note.
"It has been a very hard year for all the world in general. We are still in a very tough situation, but I think Australia is an amazing example of how to control things in the right way, so many congratulations to the country," Nadal said after beating Dominic Thiem.
"The last two weeks have been great, honestly. It’s not ideal to stay 14 days in quarantine but that’s the way it has to be done.
"We can't thank enough South Australia and Tennis Australia. This is an amazing pleasure to be in Adelaide and to play again in front of you guys. We missed you a lot."
MORE: Australian Open 2021 explainer
Australian tennis star Ashleigh Barty began her 2021 campaign with a loss on Friday but simply enjoyed being able to play again in front of fans.
"It’s absolutely fantastic to be back. I genuinely missed this so much,” Barty said. "I’ve trained over the last few months but nothing can replicate what we just did out here today.
"There’s a little bit of execution of course that we’d like to get right, but I just enjoyed it so much."