Fully vaccinated international travellers will be free to visit NSW from November without needing to quarantine but the move could put the brakes on the resumption of domestic travel.
Premier Dominic Perrottet on Friday announced international arrivals won't have to isolate when entering the state if they are fully vaccinated and test negative for the virus before and after their flight.
NSW is the first state in the country to announce it will open up to people from overseas and scrap quarantine.
But that could mean other states delay the resumption of free domestic travel even further.
The majority of states have blocked NSW travellers and many are considering home quarantine options for international travellers.
Queensland's Chief Health Officer Jeannette Young has already flagged border settings with NSW will be reviewed after the announcement.
Mr Perrottet conceded people in NSW will be able to travel overseas before they can travel to some states.
"People in NSW will be flying to Bali before Broome... (but) we need to rejoin the world," he said.
But the premier denied the decision would make it harder for people in NSW to be reunited with interstate family for Christmas.
In fact, NSW will help facilitate holiday season reunions, by helping overseas Australians from other states return home.
"If we can play a role in that, I'm very passionate about doing that," he said.
"Returning Australians will naturally be the first cab off the rank.
"Those from other states who want to come back, come through Sydney.
"Have a great time here before you go home and spend up big and help out small businesses."
However, the federal government's ability to verify the vaccination status of people jabbed overseas will also play a role in who gets to take advantage of the border opening first.
"We will require the Commonwealth, like they do with visas, to ensure that a person is fully vaccinated," Tourism and Jobs Minister Stuart Ayres said.
"There's no doubt that the Commonwealth will be able to do that with some countries faster than others and they'll also be able to do that in conjunction with many airlines faster than others.
"But we are not delineating between countries. We are delineating between vaccination status."
