Twice as many customers have been allowed back into NSW cafes and restaurants as a suite of virus restrictions ease across Greater Sydney.
Premier Gladys Berejiklian, meanwhile, says a growing COVID-19 outbreak in Melbourne - which has sparked a snap five-day Victorian lockdown - is not severe enough to consider closing the border.
But Victorian visitors in NSW after midnight will nevertheless be obliged to follow their home state's "stay at home" orders until next Thursday.
NSW in the 24 hours to 8pm on Thursday recorded no new local cases for a 26th consecutive day, but there were two cases in travellers in hotel quarantine.
The state is two days short of virus elimination - prompting Western Australia on Friday to agree to reopen its border to NSW from February 16.
Those who travel to WA from NSW from Tuesday will be obliged only to hold a G2G pass and undergo a health screening at Perth Airport.
NSW from Friday reverted to the "two square metre" rule for venues and events, and mandatory mask use has been scrapped in a number of settings. Only gyms will retain the "four square metre" rule.
Face coverings are now optional in hairdressers, beauty salons, places of worship and hospitality but will remain mandatory in transport settings.
Caps on weddings and funerals in NSW remain at 300.
With Victorians going into their third stint in lockdown from Saturday, NSW Health on Friday afternoon said anyone arriving from Victoria after Friday night must also isolate for five days.
NSW Health had previously announced that the stay-at-home order would apply to anyone who had been in Victoria since January 29. However, that cut-off date was changed following advice from Chief Health Officer Kerry Chant.
Those arriving in NSW from Victoria by air, rail or road will be required to complete a declaration form.
Residents in border communities will only have to stay at home for the five days if they have visited Greater Melbourne after 11.59pm on Friday. Border residents travelling from regional Victoria will not need to isolate. They are also exempt from the declaration form requirement.
A cluster associated with the Holiday Inn quarantine hotel in Melbourne has grown to 13 and NSW officials are tracking down people who were at the Holiday Inn between January 27 and February 9.
Everyone included must get tested and self-isolate for 14 days.
Those in NSW who visited Melbourne Airport over a nine-hour period on February 9 should do the same, while household contacts of those people should seek testing and isolate until a negative result is received.
NSW Health also strongly discouraged travel to Victoria.
But Ms Berejiklian on Friday said she would resist closing the NSW-Victoria border too hastily, in contrast to most other Australian states.
"It's an evolving situation but not a situation where the government can't really get on top of it ... I have confidence that they will. In NSW we had a similar situation before Christmas," she told the Nine Network.
"There's no reason for us to close the border. The one and only occasion where we have closed the border was to Victoria and that is when they had in excess of 150 cases a day ... we are nowhere near that."
Meanwhile, NSW contact tracers are still hunting the source of a COVID-19 infection in a returned traveller who tested positive two days after completing the required 14 days of hotel quarantine.
NSW Health is investigating the possibility the person's illness is an old infection from overseas.