Mr Kennedy, 54, died along with the train's pilot, a 49-year-old from Castlemaine.

The Sydney to Melbourne XPT service derailed about 8pm on Thursday near Wallan Station, 45 kilometres north of Melbourne.

The two deceased were travelling in the driver's carriage at the time of the incident.

Mr Kennedy has been described as an experienced driver who loved his job.

Transport for NSW secretary Rodd Staples said Mr Kennedy worked for TrainLink NSW and was well known across the business.

"He was based for work in southern NSW, and TrainLink staff knew his passion as a train driver. It was a thing he loved to do," Mr Staples said.

"He worked in different parts of the business and drove freight trains and was a very well regarded driver."

In a statement, the national secretary of the Rail Train and Bus Union, Mark Diamond, said the accident had shocked rail workers across the country.

"We are deeply saddened by the loss of two of our comrades," he said.

He described both as "popular and highly-respected members of the rail community".

The RTBU is providing support to members who were on the train and who have been affected by this tragedy.

"Our hearts go out to the families, friends and colleagues of the two workers," Mr Diamond said.

He added that the union has had "serious concerns about the state of the main line track between Melbourne and Sydney for many years".

"It is important that safety authorities conduct a full and thorough investigation of the particular circumstances of this derailment," he said.

"Two of our colleagues have been killed, and we must get the bottom of what caused this terrible tragedy."

Among the passengers, a man aged in his 60s was taken to Royal Melbourne Hospital in a stable condition for an upper-body injury while 11 others were taken to local hospitals with minor injuries.

"I imagine as a first responder who turned up it would have been looking like a horrific scene," Acting Victoria Police Inspector Peter Fusinato said.

"I'm very surprised there weren't more serious injuries ... quite a miracle really."

There are reports one man was injured while trying to save the train's driver.

Victoria Police said investigators would look into claims an announcement was made to passenger before the derailment that the train was running later and was trying to make up time.

The train was running more than two hours late when it crashed.

Authorities have said they did not know the speed the train was travelling at when the carriages derailed.

The RTBU also stated the derailment occurred on a section of track over which was awaiting maintenance.

Track conditions had been altered and V/Line drivers had reportedly refused to traverse this section over the past week.

Australian National University educational designer Dr Scott Rickard was on the train when it derailed.

In posts made on Twitter, she said the train was travelling more than 90 minutes late.

At one stage of the journey, she said the train was at a standstill for 15 minutes and passengers were told they would be there for another 30 minutes

A freight train previously derailed near Wallan on a similar track in 2017.

Infrastructure Australia knocked back a proposal in December to upgrade the section of line between Melbourne and Albury.

Investigations into the derailment are expected to take several days and will involve the Australian Transport Safety Bureau, Victoria Police and the National Rail Safety Regulator.

The crash site remains a crime scene.

The safety bureau's chief commissioner Greg Wood said a preliminary investigation would begin into the cause of the derailment once police finish their work.

The preliminary report would be released after 30 days.

Victoria police said they are still looking to speak to a number of passengers who were on the train when it derailed but alighted without speaking to emergency authorities.

Police will prepare a report for the Coroner.