The website Dorsal Watch, which lists shark sightings around the world, featured a report at 7.23pm from North Narrabeen of a "fin spotted from shore".
"Lagoon was opened up to the ocean due to storm and flood warnings," the report read.
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Earlier in the day, locals were photographed running and jumping into the lagoon as heavy rain continued to pour down.
A shark was last spotted in Narrabeen Lagoon in January 2007. On that occasion, two men said they saw a great white swimming out of the lagoon after earlier reports from a fisherman who said it pulled a duck under water.
The report of a shark swimming in flooded waters on Sunday was followed by the evacuation of some residents near the lagoon.
The Bureau of Meteorology has forecast more severe weather for today including heavy rain, strong winds and damaging surf conditions that are likely to further impact Sydney's northern beaches.