The Premier has also revealed a number of small changes to restrictions in local government areas of concern.
New South Wales has recorded 1029 new COVID-19 infections, marking a new daily record in the pandemic.
A further three people have died, Premier Gladys Berejiklian has confirmed.
The lockdown in regional NSW has also been extended until September 10, with western NSW the area of most concern.
LIVE UPDATES: Record cases in NSWhttps://twitter.com/NSWHealth/status/1430696874248335360?ref_src=twsrc%5Etfw
Easing of outdoor gathering rules
Ms Berejiklian has also revealed a number of small changes to restrictions.
Ms Berejiklian confirmed a slight easing of restrictions for the Sydney LGA of concerns.
Under the new rules, from September 13:
- Fully vaccinated households in the local government areas of concern can gather outside for recreation one hour within 5km of home between 5am and 9pm. This is in addition to the hour of exercise. Only the adults in the household need to be vaccinated.
- Groups of five fully vaccinated people who live outside of the local government areas of concern can gather outdoors within their local government areas or 5km from home.
When the state reaches 70 per cent full vaccination, "a range of family, industry, community and economic restrictions" will be lifted for people who are vaccinated, Ms Berejiklian said.
NSW Chief Health Officer Kerry Chant has given details of the three further COVID-19 deaths.
They were a man aged in his 30s from Western Sydney who died at home, man in his 60s from Western Sydney who also died at home, and a man in his 80s.
The deaths occurred from August 17 through to August 21.
READ MORE: The key COVID-19 symptoms to watch out for - and when to call an ambulance
Concerns for 'tinder box' in regions
NSW Deputy Premier John Barilaro has warned the state's regions are "sitting on a knife's edge".
"It is a tinder box waiting to explode," he said.
The regional lockdown has been extended until September 10.
"We are on a knife-edge in the regions. We need to take pressure off the health system," Mr Barilaro said.
"We've got areas of concern like western New South Wales, the far west, we still have cases in the Illawarra, in the Hunter-New England area, the Central Coast."
'We still need to be staying the course'
Earlier today, the head of the NSW AMA warned against changing the public health orders, saying health experts "don't think now is a safe time to relax restrictions".
The increase in numbers is causing additional pressure on the hospital system, with close to 80 per cent of the state's available intensive care beds now full.
Of those, 17 per cent are coronavirus patients.
READ MORE: Sydney hospital patients explain what it's like to be in the ICU with coronavirus
President of the AMA Dr Danielle McMullen said health professionals across the board believe now is not the time to relax any restrictions.
"As a healthcare organisation, we've been racking our brains for weeks to try and think of what is it the Premier could possibly announce that is safe to re-open and actually makes a meaningful change in people's mental health," Dr McMullen told Today.
"We know that lockdowns are hard and that it's difficult for mental health, it's financially difficult for many people but there is no safe relaxation at this point.
"We do need to open eventually, we can't stay closed forever and there will, one day, be COVID in the community but we can't do that yet.
"At the moment, we still need to be staying the course and getting more vaccines in and getting those case numbers down. We don't think now is a safe time to relax restrictions."
She said the situation in the state's hospitals was a reminder of why everyone needs to follow stay-at-home orders.
"We're obviously seeing the pressure really put on our healthcare system with the rising COVID cases and we have to remember that's across all areas of the health system," Dr McMullen said.
"We've got GPs being smashed with usual health care and trying to deliver vaccines, emergency departments with that real fear of not knowing who's got COVID and who doesn't, managing COVID wards, non-COVID wards and then the ICU beds are filling up.
"It reminds all of us we need to be following the stay-at-home orders and getting vaccinated as quickly as we can so our healthcare system can be there for you in your time of need."
Dr McMullen said that despite the worrying situation the "health system is definitely still there".
"We do have surge capacity plans in place and they are being enacted."
The change will help free up overloaded ambulances after some were told to take patients as far away as the north shore to cope with the demand.
The number of patients in ICU with coronavirus has risen in the past week from 77 to 113, with 40 on ventilators.
On Tuesday, Westmead announced it was reducing its intake of coronavirus patients and moving to emergency operations.
Source: 9News https://www.9news.com.au/national/coronavirus-nsw-update-latest-covid-19-case-numbers-august-26-eased-restrictions-hope-as-hospitals-struggle-with-increase-patients/7e3a89b2-768f-413b-b0da-1e9a3bb6c4a8