The NRL has been hit by a second positive COVID case in as many days, with Newcastle Knights' development player Chris Vae'lia returning a positive test.

The entire Newcastle Knights squad was sent home on Monday afternoon following a potential exposure relating to the current cluster gripping the Hunter from The Argyle nightclub.

Over 200 of 650 people who had checked into the venue have now tested positive, and while no Knights players were in attendance, household contacts of players reportedly were.

The entire Knights' playing group was sent home from training on Monday to be tested for COVID and isolate, and while the majority have results have returned a negative reading, the youngster's test came back positive.

His positive test follows that of a player at the New South Wales Blues emerging players camp, which has forced more than 30 players, including senior stars Tom Trbojevic and Nathan Cleary into isolation.

The Knights confirmed Vae'lia had tested positive in a statement released on Wednesday afternoon, but also that the remainder of the squad has returned to training today.

"The Newcastle Knights have today confirmed development player Chris Vae'lia has tested positive to Covid," the statement read.

"Chris has been in isolation since Monday and will continue to follow required protocols until he is cleared to return to training.

"All other full-time players and essential staff, who have returned negative results, will return to training today. All will be required to adhere to strict processes and protocols.

"The Knights will continue to work through all mandatory guidelines and health orders with all relevant bodies, to ensure best practise is applied."

NRL clubs are reportedly considering placing their players under biosecurity measures as the omicron variant sees cases sky in New South Wales, the state returning more than 1300 positive test results on Wednesday as restrictions ease on unvaccinated individuals.

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