The Currowan fire has burnt more than 47,000 hectares and is at a "watch and act" level as of midday on Wednesday.

The fire was downgraded from an emergency level early on Wednesday morning.

Fire crews have confirmed one home has been lost near the inland part of the fire around the Clyde River.

Numerous properties are under threat from the fire, including those in Termeil, Kioloa and Bawley Point.

Properties have also been impacted at Depot Beach and North Durras.

Incident controller with the Shoalhaven Rural Fire Service Mark Williams said four structures had been lost in the fire and that challenging conditions for firefighters were expected in coming days.

It's not known where the destroyed structures are located.

"We're trying to work in getting building impact assessment teams into the areas in the next 24 to 36 hours, but it's a very dynamic fire and difficult to access safely," Superintendent Williams said.

"Crews worked all through the night, with numerous properties under threat on Tuesday evening and Wednesday morning."

An estimated 300 firefighters are on the scene battling the fire.

One firefighter was taken to hospital on Tuesday night for superficial injuries to their forehead.

The firefighter was treated at a nearby hospital before being released.

While conditions around the firefront had slightly eased, Superintendent Williams said gusts were expected to pick up later on Wednesday and into Thursday.

"On Wednesday, we're experiencing different weather conditions, with an easterly push of wind on the coast, but the remainder of the fireground will get westerly winds," he said.

"There'll be deteriorating conditions on Thursday and the temperature will increase into the 30s."

Superintendent Williams said a majority of residents in affected areas had chosen to evacuate, while crews were helping residents who chose to stay and defend their properties.

Residents in Kioloa, Bawley Point, Pretty Beach, Pebbly Beach, Depot Beach, Durras North, Termeil and Flat Rock have been told it's too late to leave and to seek shelter.

The fire is continuing to move towards the coast, fanned by strong westerly winds, heading towards homes just north of Batemans Bay including Kioloa, Pretty Beach, Pebbly Beach, Depot Beach and Durras North.

Crews will work to clear dangerous trees along the Princes Highway on Wednesday, which had posed a risk to firefighters.

Fire crews say the blaze is also moving east towards Termeil and Bawley Point and is impacting on areas near East Lynne.

Spot fires have also been seen in the Meroo National Park, east of the Princes Highway and in areas south of Termeil Creek and North of Bawley Point Road.

The Princes Highway remains closed between the Kings Highway turn off and Burrill Lake.

Drivers have been urged to avoid the area and delay their journey if possible.

Evacuation centres have been set up at the Ulladulla Civic Centre and at the Mackay Park Function Centre in Batemans Bay.

Those in the South Durras area have been urged to leave now towards Batemans Bay if it is safe to do so.

Residents in areas west of the Princes Highway between Termeil and East Lynne have been told to monitor conditions and to follow their bushfire survival plan.

The fire has led to power being cut to nine homes in Termeil.

Power was restored a short time later.

Helen Kirkup from the Bureau of Meteorology said the South Coast fire was expected to get easterly winds around the coast and westerly winds around the inland parts of the fire heading into Thursday.

"The wind will pick up on Thursday afternoon and some of it will be quite gusty," she said.

"We could see temperatures on Thursday in the mid 30s anywhere away from the water's edge.

"Tomorrow on the South Coast, the winds will oscillate between western and north-westerly winds."