Train passenger Lee Woods saw the crash on Wednesday morning unfold.
"I couldn't believe it but I kind of predicted it at the same time. (The car) was going fast towards the train and it happened," he said.
"I saw the car coming towards the train, both were coming forward at the same time. The car was coming on an angle and there was a little jolt and I saw the crushed car go past the window. It's unbelievable."
Mr Woods, who is travelling from Melbourne to Lake Charm to see his girlfriend, said many passengers hadn't realised what happened.
"Half the people (on the train) didn't see it. I had to tell people what I saw," he said.
"It settled in when the police told everyone. Once everyone knew (the driver) was alright, it was all good."
Mildura resident Meg Richardson was another passenger. She heard the crash but didn't see anything.
"It wasn't a big impact. It did feel shaky but it wasn't too bad," she said.
"We just felt it and heard it. It happened so quickly. It's scary.
"I'm glad everyone is OK, that's the main thing.
"From the sight of the car, I couldn't believe (there were no injuries). I do traffic control and go to crashes like that all the time, it's not very good usually. I'm glad he's OK."
Bendigo Sergeant Ian Randall said it was lucky there were no injuries as a result of the crash.
"It appears a 26-year-old male has failed to give way after a loss of concentration," he said.
"(The driver) has walked away from and is very lucky.
"Investigations are ongoing into the cause of the crash and the driver is going to hospital for observation."
Sergeant Randall said none of the train passengers nor the driver were injured.
He said there were 32 passengers on the train with buses arriving to transport them to their destinations.
"We avoided a tragedy today," he said.
Police have not yet laid charges.
Passengers on Swan Hill train services have been advised to allow up to an hour extra on their journeys, following this morning's crash.
The Department of Transport has also advised motorists travelling along Airstrip Road to use nearby crossings, with the road still closed at the train line.
Alternatives include Fitzpatricks Road or Rileys Road.
Authorities have confirmed that the 33 people on board the 7.41am train from Southern Cross Station to Swan Hill, which was involved in the crash, are uninjured.
A V/Line spokesperson said the cause of the crash would be investigated.
A statement from Victoria Police said the circumstances surrounding the crash had yet to be determined.
It said the car's driver, a 26-year-old Leitchville man, received minor injuries and was taken to hospital.
Police urged anyone who witnessed the crash or had dash cam footage to call Crime Stoppers on 1800 333 000 or submit a confidential report online at crimestoppervic.com.au.
POLICE believe the driver of a ute involved in a crash with a V/Line train failed to give way at a level crossing.
The crash occurred about 10.20am on Wednesday, on Airstrip Road near Bendigo-Pyramid Road near Woodvale.
Bendigo police's Ian Randall said the driver of the Toyota Hilux, a 26-year-old man, was uninjured but was taken to Bendigo hospital for observation.
There were more than 30 passengers on the train, who were all also uninjured.
Country Fire Authority and State Emergency Service crews are escorting the passengers from the train.
A V/Line bus will take them to their destinations.
A train and a vehicle have collided on the V/Line Bendigo line near Woodvale.
Emergency services and V/Line staff are at two sites.
The vehicle remains at a level crossing on Airstrip Road near Bendigo-Pyramid Road.
The train is less than a kilometre north of Airstrip Road, in the direction of Mitiamo.
IN OTHER NEWS:
Paramedics have taken one person to Bendigo Hospital. They are not believed to be in a critical condition.
It is not yet known if there are any further injuries.
V/Line has advised of changes to the 7.41am Southern Cross-Swan Hill service, given the incident.
The service will terminate early at Eaglehawk and will no longer run to Swan Hill.
"Passengers travelling beyond Eaglehawk can board replacement coaches between Eaglehawk and Swan Hill to complete their journey," V/Line said.
"We are sorry for the delay to your journey."
Both the 12.54pm Swan Hill-Southern Cross train and the 11.33am Bendigo-Southern Cross train have been cancelled.
V/Line will be providing replacement coaches for both services to enable passengers to complete their journeys.