New South Wales has recorded 199 community cases of Covid-19, with at least 50 of those cases infectious while in the community.
Of the new cases, 88 are linked to existing outbreaks and the source of infection for 111 cases is under investigation.
NSW Premier Gladys Berejiklian said easing lockdown restrictions would be dependent on vaccination rates.
She said 6 million jabs by the end of August was the goal, with the state currently sitting at 3.9 million.
Berejiklian also urged people living in Greater Sydney to be "extra careful" when leaving their homes.
"Workplaces and households are the main places where the virus is transmitting, so we urge everybody, if you must leave the house, assume everybody you're coming into contact with has the virus," she said.
There are currently 250 Covid-19 cases admitted to hospital, with 53 people in intensive care, 20 of whom require ventilation.
The Sydney outbreak has now grown to a total of 3,832 cases since it began on June 16.
Expert predicts hundreds of cases a day for months
A leading infectious disease expert has said Greater Sydney residents should be prepared to see a few hundred cases Covid-19 cases a day for months.
Professor of infectious diseases epidemiology and modelling at James Cook University, Emma McBryde, told the ABC the current trend of high daily cases will likely continue until a higher vaccination rate is reached.
"My prediction is Sydney won't drive cases down to zero but it will maintain a small number of cases, and by small I mean a couple of hundred a day or less - for another couple of months," she said.
"By then the rest of Australia will have sufficient vaccination and be in a position where we no longer concentrate on cases and we start to look at hospitalisations and deaths and then Sydney will join the rest of Australia at that point."
However, NSW Premier Gladys Berejiklian has suggested the state's restrictions may begin to be eased in a matter of weeks if vaccination rates improve.
"Once you get to 50 per cent vaccination, 60 per cent, 70 per cent, that triggers more freedoms. We can turn this around in four weeks," Berejiklian said on Sunday.
"We have the month of August to get the vaccination rates as high as possible. Let August be the month where we break records with the vaccination."
Federal officials are becoming increasingly optimistic that NSW's weekly vaccinations could rise to 650,000, according to The Australian.
That would see the state hitting 70 per cent vaccine coverage by early September and could prompt greater easing of restrictions.
McBryde said waiting until the state reached herd immunity before lifting lockdown was not a realistic option for the NSW government.
"I don't believe that we should have herd immunity before we open up because what that means is we have zero tolerance for any Covid transmission at all and I think it's unrealistic. It will keep us in lockdown for much too long," she said.
The Greater Sydney lockdown is due to end on August 28 but is still widely expected to be extended once again.