Tests were ordered after the dead poultry were discovered on two farms in Ein Hashlosha and Holit, next to the Gaza Strip in the western Negev desert.
Several people have been admitted to hospital with flu-like symptoms.
A quarantine has been imposed around the area and thousands of birds are expected to be culled over coming days.
On Thursday, Israeli Agriculture Minister Zeev Boim said the authorities were prepared to contain the virus' spread if an outbreak was confirmed.
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