The Department of Primary Industries (DPI) first detected an outbreak on February 12 at a nearby prawn farm and believe it spread to the Yamba facility less than two weeks later.
They have placed a month-long control order on raw, uncooked crustaceans from the Clarence Estuary to give authorities time to investigate the source of the infection.
Only cooked prawns and polychaete worms may leave the region.
While white spot does not pose a threat to human health, the disease is highly infectious and can wipe out more than 80 per cent of farmed prawn populations.
White spot spreads through the movement of infected animals or contaminated water and was first detected in 1992 when it ravaged Asian prawn farms and led to the virtual collapse of the industry.
Common symptoms include a loose carapace, high degrees of colour variation on the prawn body, and white calcium deposits which cause 0.5-3mm shell spots.
Ponds and tanks struck by the epidemic will be filled with groups of moribund prawns floating on the water's surface and lethargic crustaceans with no appetite.
NSW chief veterinary officer Sarah Britton says the DPI has taken various measures to address the issue.
"Biosecurity directions are in place to eradicate white spot through accelerated destocking and destruction," she said.
This has posed a significant issue for NSW prawn farmers.
Many have been forced to stop work until the movement restriction is lifted, and swathes of prawns have been purged in an attempt to eradicate the disease.
The DPI has kept a close eye on the disease since it made its first Australian appearance in Queensland in 2016.
The only other outbreak prior to the February cases occurred in August 2022 before it was eradicated a month later.
There is no evidence of active white spot infection in wild prawn populations yet, but trace levels of white spot DNA were found in wild prawns caught from the Clarence Estuary.
NSW prawns are safe for human consumption and can continue to be bought from local seafood suppliers.
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