The Soho Foundry Tavern in Smethwick, West Midlands, closed of its own accord on Thursday 6 August after three people, including staff, tested positive after a large event at the pub.
Some 70 people who attended a barbecue at the site on Sunday 2 August have been asked to self-isolate until Sunday 16 August.
They have also been urged to get tested for Covid-19 if they feel unwell or develop symptoms of the virus.
The pub was praised by council officials for following steps to limit the spread of the potential outbreak.
Director of Public Health for Sandwell, Dr Lisa McNally, said: “They did exactly what we would want business owners to do in this situation.
“They voluntarily took the decision to close and contacted us for advice. I would urge all businesses to do the same.
“Pubs need to be very careful at this time to gather contact details of customers and ensure social distancing at all times.”
Sandwell’s deputy council leader councillor Maria Crompton added the incident was testament that coronavirus was still a threat.
Extremely serious
Crompton said: “Everyone needs to stay incredibly vigilant - the virus is still out there and the situation remains extremely serious – as this potential outbreak shows.”
The council urged employers to be understanding of the self-isolation guidance and accommodate workers who may need to stay at home.
It comes as a publican in Stone, Staffordshire has shared his regret about an outbreak of Covid-19 at his pub and described a "false sense of normality".
Britain reported the highest daily rise in new coronavirus cases since late June on Sunday 9 August, according to news agency Reuters. There were 1,062 new positive tests reported, 304 higher than the 758 new cases reported on Saturday 8 August.
