NSW could join other states in banning single-use plastic bags, with the government considering the move as part of a new plastics policy.
The review is being led by Environment Minister Matt Kean and comes after major supermarket operators Coles and Woolworths in 2018 stopped giving customers free bags for their shopping.
Mr Kean on Tuesday said the private sector had led the way and he thought NSW could go further.
"We're considering all options," he told 2GB.
"We want to see plastics stop polluting our environment. We know that single-use plastic bags are a major contributor to pollution and litter in our state, and that's why we want to look at all ways that we can clean up our environment."
NSW is the only state or territory in Australia that hasn't moved to phase out the bags.
Labor MP Penny Sharpe recently reintroduced a bill to NSW parliament in a fresh attempt to prohibit their supply.
The news comes as Mr Kean celebrated a "major milestone," with two billion drink containers collected in the first 19 months of the 'return and earn' program.
He said NSW communities were returning an average four million containers a day.
"Millions of people - one in every two adults in NSW - have changed their everyday recycling patterns and are doing their bit to reduce litter and collect their 10 cent refund," he said in a statement.
