In the same week the continent experienced its hottest day on record, thick smoke blanketed the harbour city, shrouded the Opera House and brought many outdoor activities to a halt.
The state of emergency declaration gave firefighters broad powers to control government resources, force evacuations, close roads and shut down utilities across New South Wales, which is home to more than 7 million people.
Battling more than 100 fires
Firefighters are battling more than 100 fires, more than half of which are uncontrolled, and with temperatures forecast to top 45 degrees Celsius (113°F) in some areas, officials warned residents to be on high alert.
Days out from Christmas
"The firefront has been spreading very quickly and intensely," NSW Rural Fire Service (RFS) Commissioner Shane Fitzsimmons told reporters in Sydney, adding that two firefighters had been airlifted to hospital with burns to their faces and airways. "It's still a very difficult and dangerous set of circumstances."
Days out from Christmas, a time when many Australians head to the coast for the holidays, NSW Premier Gladys Berejiklian advised people to make sure "you are prepared to change your plans should circumstances change."
The major fires around Sydney, which is home to more than 5 million people, have resulted in days of heavy pollution in the city usually known for its sparkling harbour and blue skies.
Sydney is ringed by large areas of bushland, much of which remains tinder dry following the driest Spring on record.
One megafire in the Kanangra Boyd National Park to the city's southwest had crept to the very outskirts of Campbelltown, a suburb of 157,000 people.
Three blazes ringing Sydney
The RFS posted footage on its official Twitter account showing firefighters tackling one of the three blazes ringing Sydney. A waterbomber aircraft was dwarfed by thick grey and black billowing cloud as it attempted to douse flames in bushland just metres away from homes.
Australia has been battling wildfires across much of its east coast for weeks, leaving six people dead, more than 680 homes destroyed and nearly 3 million acres (1.2 million hectares) of bushland burnt.
Weathered a storm of criticism
Prime Minister Scott Morrison has weathered a storm of criticism on social media in recent days for going on an overseas holiday during the emergency, adding to criticism that his government is failing to deliver adequate climate change policies.
As the media reported Morrison was in Hawaii with his family to enjoy a break, about 500 protestors gathered outside his official Sydney residence to demand urgent action on climate change. Morrison's office refused to confirm his whereabouts.
"ScoMo, where the bloody hell are you?"
One protestor, wearing an Hawaiian shirt, carried a sign reading, "ScoMo, where the bloody hell are you?" referencing the leader's nickname and a decade-old international advertisement for Tourism Australia that was banned in several countries because the language was deemed offensive.