Background Hendra virus (HeV) has caused lethal disease outbreaks in humans and horses in Australia. Pteropid bats (flying foxes) are the wildlife reservoir from which the virus was first isolated in 1996. Following a heat stress mortality event in Australian flying foxes in 2013, a novel HeV variant was discovered. This study describes the subsequent surveillance of Australian flying foxes for this novel virus over a nine year period using qRT-PCR testing of bat tissues submitted primarily for Australian bat lyssavirus (ABLV) diagnosis. Genome sequencing and characterisation of the novel HeV variant was also undertaken. Methods Spleen and kidney samples harvested from flying fox carcasses were initially screened with two real-time qRT-PCR assays specific for the prototype HeV. Two additional qRT-PCR assays were developed specific for the HeV variant first detected in samples from a flying fox in 2013. Next-generation sequencing and virus isolation was attempted from selected samples to further characterise the new virus. Results Since 2013, 98 flying foxes were tested and 11 were positive for the new HeV variant. No samples were positive for the original HeV. Ten of the positive samples were from grey-headed flying foxes (GHFF, Pteropus poliocephalus), however this species was over-represented in the opportunistic sampling (83% of bats tested were GHFF). The positive GHFF samples were collected from Victoria and South Australia and one positive Little red flying fox (LRFF, Pteropus scapulatus) was collected from Western Australia. Immunohistochemistry (IHC) confirmed the presence of henipavirus antigen, associated with an inflammatory lesion in cardiac blood vessels of one GHFF. Positive samples were sequenced and the complete genome was obtained from three samples. When compared to published HeV genomes, there was 84% sequence identity at the nucleotide level. Based on phylogenetic analyses, the newly detected HeV belongs to the HeV species but occupies a distinct lineage. We have therefore designated this virus HeV genotype 2 (HeV-G2). Attempts to isolate virus from PCR positive samples have not been successful. Conclusions A novel HeV genotype (HeV-G2) has been identified in two flying fox species submitted from three states in Australia, indicating that the level of genetic diversity for HeV is broader than first recognised. Given its high genetic relatedness to HeV, HeV-G2 should be considered a zoonotic pathogen.