The virus, which can be transmitted from pigs to humans via mosquitoes, has killed at least 53 people in the last few months.
Doctors say the virus attacks the brain and causes a high fever.
The Malaysian government today ordered vaccinations for 300,000 people and a further 500,000 pigs in an attempt to control the disease. Five schools located in areas prone to outbreaks of the virus were ordered closed temporarily after authorities discovered the presence of stray pigs in the vicinity had put pupils and teachers at risk. Meanwhile, reports from Singapore that it had suspended all imports of live pigs after an abattoir died from encephalitis and eight people were admitted to hospital. Eighty-two percent of Singapore's pig supply is imported from Malaysia and the rest from Indonesia. About 4,000 pigs are shipped each day from Malaysia to Singapore.