NSW has recorded 1742 new COVID cases on Thursday, a rise of more than 380 on the day before.
Thankfully, there were no deaths recorded in the 24 hour period to 8pm Wednesday.
There are currently 192 people in hospital with the virus, including 26 requiring intensive care.
Testing rates remain high as Omicron continues to spread, with 143,938 tests taken in the 24 hour period.
The second dose vaccination rate has inched higher again, hitting 93.3 per cent, while 94.8 per cent of the population aged 16 plus have had at least one dose of a vaccine.
Meanwhile, 77.8 of people aged 12-15 have had two doses of a COVID-19 vaccine, and 81.4 are fully vaccinated.
Premier Dominic Perrottet is urging people to shift the focus from infections to the number of people in hospital.
While hospitalisations generally lag infection spikes, Mr Perrottet has "complete confidence" the hospital system will cope.
NSW Health on Wednesday night issued an alert for a new venue of concern in Newcastle - the Cambridge Hotel on Hunter Street.
Anyone who attended the hotel between 6.30pm on Friday and 2.30am on Saturday is considered a close contact of a positive COVID-19 case who was there and should get tested and isolate for seven days.
All household contacts of close contacts should also be tested and self-isolate until a negative result is received.
"It is likely some of these cases have the Omicron variant of concern," NSW Health said.
Health Minister Brad Hazzard warned on Wednesday that COVID-19 cases would continue to rise, with modelling showing they could hit 25,000 a day by the end of January if the reproduction rate climbs.
Researchers from UNSW's Kirby Institute on Wednesday stressed the importance of booster shots.
They found that while two doses of a COVID-19 vaccine had little to no effect on the transmissibility of the Omicron variant, protections against severe disease - particularly with a booster shot - remained.
Boosters are available for anyone who received their second shot five or more months ago.
The explosion in cases coincides with an easing of restrictions, with unvaccinated people now allowed to mingle with the fully jabbed at shops and hospitality venues for the first time in three months.
QR code check-ins have also been scaled back and masks are only required in high-risk settings such as public transport and planes.
While masks are no longer required, Chief Health Officer Kerry Chant says her "clear advice" is for people to keep wearing them in indoor settings.
- with Australian Associated Press