Avian Influenza (AI) has devastated the poultry industries in Viet Nam, Thailand and parts of Indonesia in 2003 and 2004. This paper is based on discussions undertaken in October 2004 between the author and Indonesian government officials, broiler company representatives and farmers from the broiler and layer industries in Bali and Lombok on impacts of the AI outbreak. Government of Indonesia (GOI) policies and responses to the outbreak of firms in the Eastern Islands poultry industry are described. Farmer responses may be affected by five factors: (i) geographical location of the farm, (ii) time since the outbreak began, (iii) whether the farmer was a layer, broiler or kampung chicken producer, (iv) size and ‘development’ of the farm and (v) contractual arrangements under which production is occurring. Further research, including risk analysis, is needed to assist GOI officials in managing future outbreaks. This should include analysis of direct impacts to better understand the financial impact of AI outbreaks on industry members and analysis of indirect impacts to better understand the financial, economic and social impact of AI outbreaks on the broader Indonesian economy. A bioeconomic framework suitable for undertaking this work is developed and presented.