Virgin Australia is setting up a new international lounge network in this country and Australia for its passengers following the break-up with Air New Zealand.

The announcement marks the ground phase of what is shaping up as a transtasman battle with its former partner after the seven-year relationship soured and will end on October 27.

From then, ligible Virgin customers will be able to use a network of seven international lounges, including the Strata Lounge at Auckland Airport, as the Australian lounges are undergoing a substantial overhaul.

The international lounges in Australia will be in Brisbane, Sydney and Melbourne - where Virgin Australia has been using Air NZ's facilities - and in New Zealand, the other international lounges will be in Christchurch, Queenstown where it will also use shared airport lounges. In Wellington Virgin is developing its own small lounge.

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Several other airlines use the Strata lounge which can also be booked by any traveller from $49. At Christchurch and Queenstown Virgin will use the Manaia Lounge.

The move from Air NZ's Auckland Koru lounge comes as the New Zealand airline has had to redirect guests to the Strata Lounge because of overcrowding at peak times, sparking a backlash from some passengers.

While the Virgin move will ease some pressure on the Koru Lounge, the furore has reinforced how important lounges are for an increasing number of eligible travellers.

Virgin Australia says it is collaborating with award-winning British lounge specialist, No1 Lounges, on the international lounges to create a ''unique experience'' for Virgin Australia passengers.

The airline's Velocity frequent flyer chief executive Karl Schuster said the news was particularly exciting for Virgin's loyalty members.

"For the first time, eligible guests will have access to international lounges with a Virgin Australia flair," said Schuster.

In Brisbane, Virgin's home base, the new "My Lounge"' is still being built and has been specially designed in the style of a loft apartment with a games room and seating for more than 100 guests.

The Melbourne and Sydney international lounges will be part of No1 Lounges' new international brand, 'The House' created in collaboration with Etihad Airways.

Eligible guests include Velocity Frequent Flyer Platinum and Gold members and Virgin Australia Lounge Members (transtasman travel only) plus one guest and two children, and Virgin Australia business class guests.

Virgin Australia has opened new routes - including a seasonal service between Auckland and Newcastle - while Air New Zealand will also do more flying across the Tasman following the end of the partnership. Since the break up was announced in April, each airline has blamed the other for inflight offering had letting them down.