Wave heights have reached 4 metres in Byron Bay and are expected to reach 5-8 metres in more areas as the weather system moves down the coast.
A flood watch has been issued for possible floods in 23 NSW rivers.
Residents in the small town of Billinudgel and in low-lying areas near Coffs Creek, on the western edge of Coffs Harbour, have been ordered to evacuate due to rising floodwaters.
The NSW SES has warned people to get out now because staying means they could become trapped and need rescue.
Flood evacuation warnings have also been issued for Chinderah, the Seagulls Estate, South Murwillumbah, the township of Tumbulgum and Fingal Point area, near Tweed, west of the single-lane temporary bridge.
The warnings said residents should prepare to evacuate if authorities alert them to leave.
The Tweed and Northern Rivers area had 100 to 150 millimetres of rain fall in the 24 hours to 9:00am and the SES said the region could see a further 200 to 250 before the weather event is through.
The Sydney Light Rail network has been suspended after a tree fell on a light rail car between the Fish Markets and Wentworth Park in inner Sydney.
Police said no passengers were injured in the incident and buses will replace the service until the tree is removed.
Numerous trees have also come down over roads around Sydney including in Paddington and Petersham and an apartment building in Vaucluse has had its roof blown off.
Several Vivid Sydney installations have been damaged by the strong winds and organisers have urged visitors to delay their trip, with many installations to be switched off for the evening.
NSW SES commissioner Phil Campbell said the service had more than 2,000 calls for assistance across the state so far.
“With torrential rain and damaging to destructive winds still occurring, those calls are still coming in at a rate of around 50 to 100 per hour,” he said.
A pedestrian was killed at Marks Point in the Hunter region after being hit by a car and a woman in her 20s was killed after the car she was driving crashed into a tree at Bulli in the Illawarra.
It is unclear if the fatalities happened due to the weather, however authorities are urging people to stay off the road unless the travel is essential.
20,000 properties without power
At 8:00pm, about 20,000 properties on the Endeavour Energy, Essential Energy and Ausgrid networks in Sydney and across the state were without power as trees had brought down wires and snapped power poles.
Gale force winds have already impacted the Sydney and wider NSW coastline with gusts to about 90-100 kilometres per hour.
The strongest gust recorded so far was in Sydney Harbour at 117kmph.
Residents along the Queensland, NSW, Victorian and Tasmanian coasts were warned to prepare for strong winds and potential flooding throughout the weekend.
The storm has affected the Northern Rivers, Mid North Coast, Hunter, Metropolitan, Illawarra, South Coast, Central Tablelands, Northern Tablelands and parts of the Southern Tablelands and North West Slopes and Plains districts, the weather bureau says.
Residents in the Illawarra and south coast are bracing for more rain, after being hit with 100 millimetres overnight, as the east coast low continues to move south across the state.
Public transport has also been affected with buses are replacing trains in both directions between Wollongong and Port Kembla, as trains have been cancelled due to localised flooding.
SES watching the state’s rivers for flooding
A moderate flood warning has been issued for the Wilsons River at Lismore and Richmond River in northern NSW.
Minor flood warnings have been also issued for Tweed River at Murwillumbah and Chinderah, the Brunswick River Valley and the Bellinger River.
A flood warning has also been issued for the Coffs Creek and the Coffs Harbour urban area.
Commissioner Greg Newton said the SES was watching rivers throughout the state carefully.
“We’ve got over 100 SES units along the coast with members standing by to respond, along with resources from both Fire and Rescue NSW, NSW Police and NSW Ambulance Service,” Commissioner Newton said.
He said there was localised flooding in the state’s north, but there were also local roads closed near Wollongong and in the south of the state due to rising floodwaters.
“What we’ll probably see later on today is peak tides, some of the biggest tides on the year, later on this afternoon,” Mr Newton said.
“That combined with waves of five to seven metres, it pose as real risk of coastal erosion up and down the coast.”
NSW State Emergency Services spokesman Phil Campbell said he encouraged people to delay any non-essential travel, particularly in the areas worst effected.