Chief Health Officer Kerry Chant said 236 people with COVID were in intensive care in NSW while 123 were on ventilators.
She announced Cowra was going into lockdown for seven days.
NSW has recorded 935 cases of COVID-19 and four deaths.
One case was acquired overseas.
NSW Premier Gladys Berejiklian said we cannot read too much into the lower case numbers.
"Even if case numbers go down we can expect the number of people in intensive care and the number of people who lose their lives to go up because as we've said consistently because we've had a number of cases in the last few weeks people ordinarily get very sick in the second week of the illness and sometimes stay sick for a long time," she said.
Two men in their 60s from south western Sydney died at Liverpool Hospital.
A man in his 80s from western Sydney died at Nepean Hospital. His death is the second linked to an outbreak at Uniting Edinglassie Lodge Residential Aged Care Facility in Penrith.
A woman in her 80s from the Wollongong area died at Wollongong Hospital.
There are currently 1,207 COVID-19 cases admitted to hospital, with 236 people in intensive care, 123 of whom require ventilation.
In the 24 hours to 8pm Sunday, 124,650 tests were received and 23,156 vaccinations were administered.
Victoria recorded 567 new cases of COVID-19 in the 24 hours to midnight Sunday.
IN OTHER NEWS:
The new cases are:
Yesterday the Victorian government announced all council areas in the bubble, except for Albury, would now be classed as a red zone.
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