Sheep producers are being warned to keep an eye out for panic grasses on the back of recent rain.
Victorian district veterinary officer Jeff Cave said panic grasses, also known as fairy grass, witch grass and hairy panic, responded rapidly to rain.
Dr Cave said these grasses could cause photosensitisation and death when ingested, particularly in lambs.
He said the young, rapidly growing grasses contained steroidal saponins, which when eaten could form crystals in the liver, damaging the liver cells and obstructing the outflow of bile.
The breakdown products of chlorophyll, which is found in green grass, are then no longer cleared by the liver and cause damage to skin tissues when exposed to light.
So, he said the thin skinned, wool-free parts of the sheep which were exposed to sunlight got damaged and showed signs like severe sunburn.
Typically affected areas were the ears, eyelids, nose, lips and vulva.
Affected lambs will seek shade and be reluctant to graze.
Dr Cave said the liver damage could lead to jaundice, and with the swelling caused by photosensitisation the condition was sometimes known as 'yellow bighead'.
This liver damage can kill the lambs before photosensitisation develops.
He said the only treatment was to remove affected stock from the toxic pastures and provide them access to shade.
If this happens promptly, affected stock can recover completely, as the liver has a remarkable ability to heal itself.
However, he said some livers may never recover totally, and this would lead to ongoing poor metabolic processing of food consumed.
Dr Cave said the best prevention was to avoid grazing risky paddocks.