"Large air tankers have been used to drop retardant close to homes in an effort to slow the fire."

The fire triggered an emergency warning but after 6pm, had been downgraded to watch and act as conditions were easing.

"As conditions ease on the fireground, firefighters will conduct backburning operations where conditions allow," the NSW RDS posted on Twitter.

"Residents in the area will see an increase in smoke and flames while these operations are carried out."

Residents in Lake Cathie, Long Point, Bonny Hills, Kew, Kendall, Herons Creek and Bobs Creek were warned to monitor conditions.

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Inspector Ben Shepherd said a smoke haze over Newcastle, Sydney and the Illawarra was from "fires up towards the Port Macquarie region".

"Most of the smoke is drifting down under very strong north-northeasterly winds," he said.

"The winds are particularly strong and will continue throughout the afternoon so we are likely to see the smoke hanging around Sydney for some time."

The RFS subsequently warned the smoke was expected to settle "and may continue for the next few days".

NSW Health reminded people that children, older adults and people with heart and lung conditions were most susceptible to the effects of air pollution and excessive smoke.

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There were 74 fires burning across NSW at 5pm on Tuesday with 44 of them yet to be contained.

Much of state's sout-heast will be under very high fire danger for Wednesday.

This includes the greater Hunter, greater Sydney, Illawarra/Shoalhaven, Monaro alpine, Southern Ranges and Central Ranges fire areas.

Parts of the state's north-east and south-east will also be under a high fire danger rating.

AAP