The number of new daily cases of COVID-19 has almost halved for the second day running, with the state reporting eight cases to 8pm on Monday night.
There were also 10 cases in returned travellers in hotel quarantine.
Seven of the locally acquired cases are linked to the Avalon cluster - which now has 90 cases - and one remains under investigation.
Premier Gladys Berejiklian said this eighth case may end up being internationally acquired, as it was found in a quarantine nurse involved in the transfer of patients at the international airport.
Ms Berejiklian highlighted that the lower case number had been found among a record 44,466 tests reported to 8pm last night.
"This was a record we did not expect," she said, adding that she was "proud and deeply grateful that people had responded" to calls for more testing.
"NSW is really pulling together to get through this stage of the pandemic."
However she said it was concerning that the number of potentially exposed venues had continued to grow, and asked people to continue following the public health orders.
She said she was still planning to make an announcement tomorrow about what restrictions for Greater Sydney, Central Coast and Wollongong would look like over Christmas.
"At the moment, the trend is going where we want it to go," she said.
"The measures we have in place, plus the way the community is responding, is helping us to get on top of this.
"The decision would be much easier if it wasn't this time of year."
She said there was no reason to consider changing what is happening in NSW regional communities.
NSW Chief Health Officer Dr Kerry Chant said there had been an additional case linked to the quarantine healthcare professional identified since 8pm last night, which will be included in tomorrow's numbers.
A Victorian resident who had been holidaying in the Northern Beaches has also tested positive.
This case, which is not included in the NSW numbers, presented for testing in Victoria on December 20 and the positive result was received on December 21.
They have been isolating since their return to Victoria. The family members of this case in Sydney are all in isolation and have tested negative to date.
Dr Chant also said there had been an extra "50-odd" venues added to the long list of places exposed to the virus overnight.
There remains no exposure in the Wollongong LGA, which has been included in the NSW Government's restricted areas.
Suburbs affected by the location alerts now include Alexandria, Avalon, Avalon Beach, Bayview, Belrose, Berowra, Blacktown, Cronulla, Crows Nest, Double Bay, Erskineville, Forster, Freshwater, Gordon, Hornsby, Kirribilli, Lane Cove, Macquarie Park, Manly, Mount Colah, Mona Vale, Milsons Point, Narrabeen, Neutral Bay, Newport, North Sydney, Paddington, Palm Beach, Penrith, St Peters, Surry Hills, Sydney, Turramurra, Woolloomooloo and Warriewood.
A full list of venues and public transport routes is available at https://www.nsw.gov.au/covid-19/latest-news-and-updates.
NSW Health is treating 93 COVID-19 cases, none of which are in intensive care.
Our COVID-19 news articles relating to public health and safety are free for anyone to access. However, we depend on subscription revenue to support our journalism. If you are able, please subscribe here. If you are already a subscriber, thank you for your support.