Daily COVID-19 cases in New South Wales have shot into five figures in an Australian first, with 11,201 recorded in the 24 hours to 8pm last night.
Hospitalisations rose to 625, with 61 people in intensive care.
Three people died with the virus.
Two women, one in their 70s and one in their 90s, died at the Warabrook Aged Care facility in Newcastle where they acquired their infections.
A man in his 80s from Sydney's Inner West died at Royal Prince Alfred Hospital.
Hospitalisations are up by 68 patients on yesterday, placing further strain on a medical system already overstretched by thousands of workers being forced into isolation, along with massive demand for COVID-19 testing.
There were 157,758 tests carried out in NSW in the 24 hours to 8pm last night.
Changes to contact tracing and isolation periods
NSW Health said they have changed their approach to contact tracing, prioritising "households of cases and settings with vulnerable people where COVID-19 cases may have visited or worked".
Prior to the current surge in cases, NSW Health would contact people exposed to the virus but now people who are positive are directed to tell those they have been in contact with.
"People who have been confirmed as COVID-19 cases are asked to tell those they have recently spent time with that they have tested positive," NSW Health said.
"NSW Health will only contact with a small number of exposed people to direct them into self-isolation under the public health order."
There are also moves to cut the isolation times for people with COVID-19 as more virus sufferers in New South Wales are told to manage their symptoms at home.
NSW cut the isolation period for people infected with COVID-19 to 10 days last week, but further reductions are under consideration.
Rapid antigen test shortages in NSW
Meanwhile, NSW continues to call for people to avoid PCR testing unless they are directed to get one or have COVID-19 symptoms, with testing clinics overrun around the state.
Yesterday, at least one clinic was forced to turn people away even before it opened, as those seeking tests queued overnight.
But Pharmacy Guild of Australia NSW president David Heffernan said there was a shortage of rapid antigen tests on shelves due to the public holidays.
"Having these announcements obviously don't help when pharmacies don't have the ability to top up," he said.
"There has been a spike in the demand of rapid antigen tests and therefore a lot of pharmacies have been depleted."
NSW Premier Dominic Perrottet said more stock had been ordered.
"We've put an order in for 20 million rapid tests and my understanding is they will be available by the end of January," he said.
NSW reported 6062 new COVID-19 cases and one death yesterday, with intensive care admissions rising only slightly.