Wallabies have long been present north of the Waitaki River but south of the river they are considered a pest.
They can stop native bush regenerating, can spread tuberculosis and also compete with livestock for dry matter and green feed crops.
After the confirmed sightings of the pests by a pest contractor, the Otago Regional Council inspected the area and found wallaby droppings in seven places in recently harvested forestry blocks.
Under the council's pest management strategy landowners are required to eradicate any wallabies on their properties.
Council staff would be inspecting the areas in an attempt to eradicate the wallabies.
''It is believed that wallaby have been released in this area and a small population has expanded its range.''
ORC Chairman Stephen Woodhead said at a recent meeting it would be a real concern if a population of wallabies, which he described as a ''gigantic rabbit'', established itself in North Otago.
Cr Graeme Bell said there needed to be more publicity about the danger wallabies posed in Otago, especially if hunters were releasing them.
''We need to do something about this. They're getting too close to Central Otago and the Pigroot.''
Council policy planning and resource management Fraser McRae said the pest management strategy was being reviewed with a view to having a South Island-wide pest management strategy.
''We're pulling together a common list of species that are consistent between us but there will be some differences.''
