More than 400 State Emergency Service volunteers have gathered in northern NSW in preparation for flash flooding and damaging winds.
A severe weather warning was issued for the Northern Rivers, the mid-north coast, Northern Tablelands and parts of the Hunter and North West Slopes and Plains on Sunday as Oswald slowly moved south from Queensland.
State Emergency Service (SES) spokesman Phil Campbell said two motorists had already been rescued from floodwaters on Sunday, with one person caught in their car near the border at Tenterfield and another trapped further south at Grafton.
Meanwhile at around noon (AEDT) a Fire and Rescue NSW (FRNSW) helicopter was helping the SES move campers who had been surrounded by floodwaters near Grafton.
'The initial concern for us will be the potential for flash flooding and the potential for people to get themselves into trouble,' Mr Campbell told AAP.
More than 400 SES volunteers were stationed in the north of the state with warnings that Oswald was likely to bring damaging winds of up to 110km/h.
'That wind velocity can cause damage to property and bring down trees and power lines,' Mr Campbell said.
'There is also some potential for local destructive winds in the Northern River region.'
Once the rain sets in, Mr Campbell said the SES will be monitoring the state's main rivers with moderate to major flooding expected.
On the Bellinger River at Thora in the state's north, a minor flood warning is in place and the Bureau of Meteorology (BoM) is warning that a further 150mm of rain could fall over the next day or two.
Mr Campbell said this was expected to cut off more than 500 people in rural properties slightly upstream at Darkwood.
'They will be isolated for a couple of days so we have asked them to stock up,' he said.
The wild weather is expected to move further south on Monday, with strong winds and downpours forecast for Sydney, the SES said.
Motorists travelling on the state's mid north or far north coast are being urged to take extreme care, with reports of heavy rainfall, debris and reduced visibility at some local roads, the NSW Transport Management Centre said.
'Additionally, heavy holiday traffic is also being experienced on the Pacific Highway for motorists travelling southbound approaching the Hexham Bridge, in Newcastle,' it said in a statement.