NSW will enforce a lockdown for four Sydney council areas as the state records 22 new local cases of COVID-19.
Premier Gladys Berejiklian presented the numbers on Friday morning after a crisis meeting to review the growing amount of cases across the state.
Eleven of the cases were detected in the 24 hours to 8pm on Thursday night, six of which were already reported. There were 17 further infections which will be recorded in Saturday's tally.
People who live or work in Woollahra, Waverley, Randwick and the City of Sydney will not be able to leave home for a week except for essential purposes.
These include work or education, shopping, providing care or outside exercise.
"If you live or work in those local government areas, you need to stay at home unless absolutely necessary," Ms Berejiklian said.
There are now 65 cases linked to the Bondi cluster that erupted in the city's east last week.
The government had previously held off declaring a lockdown, instead preferring to restrict the movements of residents, increase mask wearing and limit social and other gatherings.
Ms Berejiklian on Thursday warned the state was facing its "scariest" period since the pandemic began.
NSW Health has added several exposure sites including two cafes in Potts Point, two cafes in Alexandria and a health club in Bondi Junction to its list of venues of concern on Thursday evening and Friday morning.
Meanwhile, Deputy Premier John Barilaro has tested negative to COVID-19 after a virus scare in the state's parliament. However, the NSW Nationals leader must follow health advice and remain in isolation in Sydney until July 6 and be tested at least two more times.
The NSW parliament was on Thursday declared a potential exposure venue during one of the busiest weeks of the year - budget week - after Agriculture Minister Adam Marshall tested positive.
Many state MPs were deemed close contacts and hundreds of people working in the building on Sydney's Macquarie Street this week were at risk of exposure.
Ms Berejiklian was tested and cleared on Thursday morning, as was Health Minister Brad Hazzard.
Parliament House workers were told to stay home on Thursday while a group of MPs underwent rapid testing so they could enter parliament and pass the 2021/22 budget which was handed down on Tuesday.
Australian Associated Press