Nearly 100 fires are burning across the state since morning, with 30 of them uncontained, and 1500 firefighters are still battling to contain the fires, reported Xinhua.
Firefighters said as many as 200 homes and over 20,000 hectares of land are feared to be destroyed as the bushfires broke out across the state from Thursday and strong winds worsened the conditions.
"I suspect if we get through that without the loss of life, we should thank God for miracles," said Barry O'Farrell, NSW premier at a news conference Thursday evening.
The premier also warned that it would take days to extinguish all the fires.
Mark Greenhill, the mayor of the Blue Mountains region of NSW, told the Seven Network Friday that dozens of homes were known to be lost in Thursday's bushfires.
"The Blue Mountains has experienced bushfire before, but nothing like this," Greenhill said.
"We lost scores of homes; there are a lot of families without homes right through the area," he added.
The mayor said he and other counsellors had spent the evening comforting residents who had lost everything in the "unprecedented" fires.
"This has been a very tough 24 hours for the community of the Blue Mountains," Greenhill said.
The full extent of the catastrophe will be clear later the day, according to the authorities.