The Bureau of Meteorology has issued a severe storm warning for much of NSW on Wednesday, as well as the vast majority of the ACT.
It says severe thunderstorms may produce heavy, locally intense rainfall.
"Severe thunderstorms are likely to produce heavy, locally intense rainfall that may lead to dangerous and life-threatening flash flooding in the warning area over the next several hours. Locations which may be affected include Gosford, Sydney, Wollongong, Nowra, Armidale, Orange, Canberra, Goulburn, Tamworth, Moree, Dubbo, Wagga Wagga and Deniliquin," it said in a statement issued at 7.01pm.
The bureau pointed to the heavy rain which hit Canberra on Wednesday morning, saying there had been 21 millimetres of rain in the 30 minutes to 11.45am at Lake Burley Griffin.
Heavy showers are expected across Canberra throughout most of Wednesday and into the rest of the week.
However, a torrential downpour leading to widespread flooding as seen in recent on the NSW Mid North Coast is not likely to happen in the capital, according to the Bureau of Meteorology.
As much as 40 to 50 millimetres of rain is predicted to fall in Canberra in the coming days.
Showers and thunderstorms have been forecast to take place on Thursday and Friday.
Senior forecaster at the bureau, Neale Fraser, said the widespread rain was due to an unstable weather pattern and slow-moving trough.
"It's a broad trough from the north-west of NSW through to the south-east," Mr Fraser said.
"We're expecting an increase in shower activity in Canberra on Wednesday ... evening, and that's also the picture for Thursday and Friday as well."
It comes as storms caused by the weather system have battered coastal areas in northern NSW in recent days.
Parts of the region have received as much as 600 millimetres of rain in the past five days, with many beaches washed away due to the storms.
Residents in parts of the NSW Mid-North and North Coast have also been given evacuation orders due to the heavy rain and flooding.
Mr Fraser said rain from that system would impact large parts of the NSW coast as the trough moved through and would reach some inland areas such as Canberra.
However, he said the rain was set to subside by the weekend.
"By the weekend, the system will have pushed into the north-east of the state and the weather will be more settled," he said.
"In the next three days, however, there could be one big storm that dumps a decent lot of rain in suburban Canberra."
Thursday will have a top of 29 degrees with a 60 per cent chance of rain with up to 6 millimetres expected.
Friday will have a maximum of 27 with up to 8 millimetres of rain expected.
