At least 700 homes have been destroyed in Victoria and about 14,000 homes are without power.
Most of the people who died came from a cluster of small towns to the north of Melbourne. The BBC's Phil Mercer in Sydney said many charred bodies had been found in cars. It is thought they were trying to escape the fires but were overtaken by their "sheer speed and ferocity".
Some cars appeared to have crashed into one another as people tried to flee the flames.
Victoria Country Fire Authority said the death toll had risen to 108.
At least 18 people were reported to have died in the town of Kinglake, four at Wandong, four at St Andrews and three at Strathewen.
One Strathewen resident told ABC local radio how people had witnessed "absolutely horrific" scenes as they had helped battle the flames.
"The school's gone, the hall's gone... some people left it too late. We've lost friends, and we're just waiting for more - children, loved ones," she said.
The town of Marysville, with about 500 residents, was said to have been burned to the ground, though most residents managed to shelter from the blaze in a local park.
Australia is a tough country to live in. We have had no rain for eight weeks and that is why so much is burning.
In Kinglake, where witnesses said most of the town was destroyed, one woman quoted by the Melbourne Age described the arrival of a badly burnt man and his daughter seeking shelter on a patch of open ground.
"He had skin hanging off him everywhere and his little girl was burnt, but not as badly as her dad, and he just came down and he said 'Look, I've lost my wife, I've lost my other kid, I just need you to save [my daughter],'" she said.
Tens of thousands of firefighters have been trying to contain blazes in two other states - New South Wales and South Australia - but the fires there were largely contained or burning away from residential areas.
The fire service is using water-bombing aircraft to contain fires and thousands of volunteers are using water hoses.
Witnesses say the fires have been up to four storeys high (Pic: Grant Smith)
"It's obviously a tragic day and a tragic week in our history," Victorian state Premier John Brumby said.
Late on Sunday, he said he had accepted an offer from Prime Minister Kevin Rudd to send in troops to relieve overstretched emergency crews.
"Hell in all its fury has visited the good people of Victoria in the last 24 hours," said Mr Rudd.
Bush fires are common in Australia, but the current blazes have eclipsed the death toll from what had been the previous worst fire in 1983, when 75 people died on a day that became known as Ash Wednesday.
The leader of the Green party, Bob Brown said summer fires would get worse unless Australia and other nations showed more leadership on reducing greenhouse gas emissions.
"It's a sobering reminder of the need for this nation and the whole world to act and put at a priority our need to tackle climate change," he said.
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