HUNDREDS of homes are feared destroyed and Premier Barry O'Farrell has spoken of the first death to be confirmed in the distaster.

"Regrettably this is what no one wants to happen," Mr O'Farrell said of the death of a 63-year-old man who suffered a heart attack while he was fighting a fire at his home at Lake Munmorah on NSW's Central Coast.

Mr O'Farrell amde the comments from Rural Fire Service headquarters in Sydney where he was being briefed this morning.

The premier will head to the Blue Mountains on this afternoon where he will inspect the damage from the air and speak to the media.

While the extent of the devastation was unclear on Thursday night, one of the worst-hit areas was Springwood, in the Blue Mountains, where more than 40 homes were known to be lost.

Large fires continued to burn into the early hours of the morning with emergency warnings remaining in place for the Ruttleys Rd fire near Wyong on the Central Coast and between Lithgow and Bilpin.

NSW RURAL FIRE SERVICE MAP OF CURRENT FIRES AND INCIDENTS

A drop in temperature is expected today of about 10C with the hope that the cooler conditions will give firefighters the upper hand but 100 fires continue to burn with 20,000 hectares being lost to the inferno in the Blue Mounatins area.

News_Image_File: A large bush fire burns through bush near the Williamtown Airport near Newcastle. Picture: John Grainger

But when the ashes settle, the number of destroyed or damaged properties across the state is expected to be much worse.

Elsewhere, thousands of firefighters were struggling against around 100 blazes across the state - on the Central Coast and further north, the Southern Highlands and the south coast.

It was too soon to estimate how many properties had been lost, but Rural Fire Service Commissioner Shane Fitzsimmons predicted: "we'll be counting properties in the dozens, if not the hundreds." Premier Barry O'Farrell and Mr Fitzsimmons told reporters the public should brace for widespread destruction.

STAY UPDATED:

• The Blue Mountains turned black

• People flee as fires run wild and hot

• Greens play politics as homes burn

• Homes lost as Springwood, Winmalee hit

"It will take some days until we see the end of these fires," Mr O'Farrell warned.

"I suspect that if we get through that without the loss of life we should thank God for miracles."

Mr Fitzsimmons said firefighters faced the worst of conditions. "This is as bad as it gets," he said.

Schools at the Blue Mountains were also drawn into the drama and scores of Blue Mountains residents sought refuge at evacuation centres on Thursday night, including the Springwood Sports Club and Springwood Country Club.

While St Columba's students were kept in their school, St Thomas Aquinas School was evacuated.

News_Image_File: The smoke from the bushfires sits above the city of Sydney on a hot day with extreme winds / Picture: Phil Hillyard

About 600 kids from several schools were bussed to the Springwood Sports Club on Thursday evening.

Many have since left with parents but a lot won't be able to return to their homes, the ABC reports.

A 2000-hectare bushfire at Muswellbrook that's out of control was at 8.50pm (AEDT) threatening properties.

News_Image_File: RFS firefighters try to control a busfire on the Mariah River Rd between Port Macquarie and Crescent Head.

Residents have been advised to leave the area after the "watch and act" alert was upgraded to an "emergency warning."

"Firefighters are undertaking property protection under difficult, dangerous and erratic weather conditions," the RFS says on its website.

A fire at North Doyalson has been downgraded from an "emergency warning" alert level to a "watch and act."

RFS Deputy Commissioner Rob Rogers said it was one of the worst days he'd seen.

"It's probably the most serious fire risk we've faced since the early 2000s," he said.

For most of the day there were six fires at "emergency warning" level, meaning homes were at risk and residents were being asked to consider fleeing.

Before 6pm, a cool change brought temperatures down from the mid-30s to the mid-teens.

But it also created new chaos, swinging fire fronts around and pushing blazes into new areas.

There were unconfirmed reports of properties being lost at North Doyalson, on the Central Coast; at Lithgow; at Yanderra and Balmoral, in the Southern Highlands; and in Port Stephens, where a fire has forced the closure of Newcastle Airport.

News_Module: NND Before After - Opera Harbour

At least two firefighters were injured, with one man sent to Sydney's Concord Hospital with burns to his face.

The fires created traffic chaos around Sydney, with a 20km queue on the Hume Highway for city-bound traffic.

News_Module: NND Before After Sydney Uni

All northbound lanes on the highway were reopened about 9.45pm (AEST), the Transport Management Centre said, with just one southbound lane opening.

The Insurance Council of Australia (ICA) has formally declared a "catastrophe" for affected areas.

ICA CEO Rob Whelan said the group expected to have a better idea of the damage by the weekend, but added that insurers were ready to take claims.

News_Image_File: A large bush fire burns through bush near the Williamtown Airport. Picture: John Grainger