NSW Premier Gladys Berejiklian says Covid-19 infections are expected to peak in the next two weeks after the state recorded 1431 new cases and 12 deaths.
Today's numbers were the highest daily infection figures ever recorded by an Australian jurisdiction in a day.
"The next fortnight is likely to be our worst in terms of the number of cases," she told a press conference in Sydney.
There are currently 979 Covid-19 cases admitted to hospitals in the state, 160 people are in intensive care, 63 of whom require ventilation.
One of the 12 fatalities was a woman in her 30s in south-west Sydney who died at home on 1 September.
NSW deputy chief health officer Marianne Gale said investigations were under way into the source of her infection.
She was not vaccinated.
The other 11 deaths were people between in their 70s, 80s and 90s who lived in south-west and Western Sydney.
The premier said the record rates of vaccines being administered in Sydney's 12 local government areas (LGAs) of concern would take time to build an immunity profile.
"The amount of vaccines that we are putting in arms are people living in those communities … has been outstanding and that will have a positive effect on the spread and the likely number of cases," she said.
"It means that the highest number of people in our intensive care wards are likely to present during the month of October."
Yesterday the state announced 1288 cases and seven deaths.
Cases top 200 in Victoria
Victoria has recorded 208 new locally acquired cases of Covid-19 and one more person has died with the virus in the state.
Of the new cases, 96 are linked to known outbreaks.
The health department has not provided information about the number of new cases who were in isolation for their infectious period.
The death recorded overnight is the third fatality this week from Victoria's Delta outbreak, which now stands at 1180 active cases.
The new cases were identified from 48,572 test results received yesterday, while there were 33,511 doses of vaccine administered at state-run sites.
According to federal health department figures, 58.1 percent of the eligible Victorian population has received their first dose of a vaccine, while 36 percent are fully vaccinated.
Victoria's daily case count has risen sharply this week, going from 73 cases from tests taken on Monday, to 119 on Tuesday, 176 on Wednesday, and 208 from tests on Thursday.
The last time Victoria recorded more than 200 new cases in a single day was 22 August 2020, when 202 cases were recorded. It is the highest daily figure since 231 cases were recorded on 19 August.
Health professionals are bracing for the impact on Victoria's hospital system now that the state has changed its position on driving case numbers from the state's Delta outbreak to zero. Instead, the path out of lockdowns is hinged on vaccination targets.
As of last night, there were 61 Covid-19 patients in Victorian hospitals, including 20 in intensive care, with 13 of those people on ventilators.
Emergency Physician Dr Stephen Parnis said it was not yet known what the effect that change in focus would have on the hospital system.
"In some ways, we are back to where we were in early 2020, wondering if the hospital system will have the capacity to get through what is going to be a very tough three to six months I think," he told ABC News Breakfast.
"We know how difficult things have been for our colleagues in Sydney in recent months, it's really been quite a terrible time in the hospitals up there and in Melbourne I think it's fair to say none of us have really fully recovered from last year's second wave so it's a constant state of readiness."
Dozens of new venues were added to Victoria's list of Covid-19 exposure sites last night, including a childcare centre in Coburg, and a fertility clinic in Melbourne's CBD.
Playgrounds in Victoria have reopened after Premier Daniel Andrews announced a slight easing of some restrictions earlier this week.
Only children under the age of 12 are able to attend playgrounds, and can only be accompanied by one parent, who is not permitted to eat or drink at the site.
NSW border bubble arrangements tightened
From today, the number of communities in the Victoria - New South Wales border bubble will be reduced, and there will be fewer permitted reasons to cross the border.
Victorian health authorities said with more than 1000 new cases per day and a trajectory of exponential growth, the risk NSW posed was too great.
The Victorian local government areas (LGAs) of Greater Shepparton, City of Benalla, Greater Bendigo, Buloke, Loddon and Yarriambiack were removed from the bubble at 11.59pm last night.
The NSW local government areas of Broken Hill and Edward River have also been removed.
NSW Cross-Border Commissioner James McTavish said yesterday he was blindsided by the changes.
"We're a little confused as to why Edward River's been removed - there's never been any community transmission there, there's no community transmission or cases there now, and they're highly reliant on services delivered out of Victoria," he said.
- ABC