The alert has been lifted for a large bushfire that destroyed homes, shacks and businesses in Tasmania's south-east.

The which fire has been burning for four weeks has been downgraded.

After starting near Forcett, the blaze devastated the town of Dunalley and tore through towns and rural communities as far south as the Tasman Peninsula.

Hundreds of buildings were destroyed and thousands of acres of farmland was burnt.

The Fire Service's Paul Symington said there is now no alert level.

"The fire is considered under control and is being patrolled at regular intervals but we still ask that members of the public remain aware that this fire still has potential under strong winds and warmer days to still cause us some problems," he said.