NSW recorded 233 new locally acquired cases in the 24 hours to 8pm on Tuesday, with 47 infectious in the community.
Two people have also died, a man in his 20s and a woman in her 80s.
The man in his 20s died at his home in south-west Sydney on Tuesday evening, which NSW Premier Gladys Berejiklian said "demonstrates again how this disease is lethal and affects people of all ages".
The man had not received any dose of any vaccine. His death has been referred to the NSW Coroner.
"As we understand it the death happened quite suddenly," Ms Berejiklian said.
"People who are vaccinated are staying out of hospital, are staying out of ICU."
The woman in her 80s was from the inner west and died at the Royal Prince Alfred Hospital yesterday. She tested positive on July 27 and was at the hospital since then. She was not vaccinated.
Newcastle and NSW Hunter Valley residents have been urged to come forward for testing after "very high viral load" was detected in the region's sewage.
While virus fragments were also detected in the sewage at Coffs Harbour and Bonny Hills on the NSW Mid North Coast and Mudgee in the Central West.
"There were very high rates of virus detected in the sewerage in the Hunter area," Ms Berejiklian said.
"The very high viral load suggests there could be undetected cases up around the Hunter area."
Chief health officer Dr Kerry Chant said health authorities were "very concerned".
The detection was from both the Shortland and Burwood plants, as well as a "lower detection" at Belmont.
Birmingham Gardens, Shortland, Maryland, Fletcher, Minmi, Cameron Park, Stockton and Fern Bay were among the suburbs flagged as priorities for testing.
Dr Chant said everyone with symptoms to go home immediately after a test, and said testing could help authorities determine what was behind the result.
More than 105,000 people were tested in the 24-hour period.
Of the 233 locally acquired cases, 103 were linked to a known case or cluster with 79 being household contacts and 24 close contacts. The source of infection for 130 cases is under investigation.
Ninety-two cases were in isolation throughout their infectious period and 21 were in isolation for part of their infectious period. Forty-seven cases were infectious in the community, and the isolation status of 73 cases remains under investigation.