At least fifteen homes have been lost as bushfires swept through Coonabarabran in the north of the state, the NSW Rural Fire Service says.
Dozens of sheds were also ruined by fire along with stock and machinery.
Most of the destroyed properties were on Timor Road, according to early reports, but the damage assessment is expected to continue into Monday afternoon.
Parts of the Siding Spring Observatory have also been damaged by fire, although it's believed the main telescope has survived.
Staff from the observatory in Warrumbungle National Park were evacuated on Sunday to nearby Coonabarabran due to the blaze.
A watch-and-act remains in place for the fire, which has burnt through more than 32,000 hectares of bush, scrub and grass.
Overnight the RFS, which has described it as a "large and dangerous bushfire" have been focusing on fighting the blaze.
But RFS spokeswoman Laura Ryan said they are expecting to be able to go into the site on Monday morning to access the damage.
"We have got reports that the main telescope has survived but whether it has been damaged is not confirmed," she told AAP.
"As the sun comes up we are hoping to get a clearer view."
More than 65 firefighters and 17 trucks were on site in the early hours, with more expected to arrive throughout Monday.
Meanwhile, more than 110 people have been evacuated to Tattersalls Hotel at nearby Baradine, as the RFS warns people not to return home.
Ms Ryan said the RFS could not give any indication at the moment as to when it might be safe to do so.
"It's another reminder that fires can strike quickly and can be incredibly dangerous and damaging," Ms Ryan said.
Across the state, however, firefighters are expecting some reprieve with milder weather conditions forecast and winds tending to the south.
There are no total fire bans across the state, with fire dangers listed as moderate and high throughout southern NSW and along the coast, with very high fire danger in the north-west.
About 170 blazes are burning through bush, scrub and grass with about 50 of those out of control.
Light rains have been experienced overnight at the fires in Yarrabin near Cooma and Deans Gap in Shoalhaven, which have together burned through more than 20,000 hectares.
While the drizzle slightly hampered hazard reduction it also offered firefighters some relief, Ms Ryan said.