NSW is shutting down all non-essential services to slow the rapidly spreading coronavirus but schools will stay open for now.
Premier Gladys Berejiklian is encouraging parents to keep their kids at home for the rest of the term if they are able.
"I want to stress that schools in NSW from tomorrow will remain open," she told reporters on Monday morning.
"The health advice has not changed however, for practical reasons, in NSW we will be encouraging parents to keep their children at home."
Ms Berejiklian said no child would be turned away from a public school in NSW.
"Already last week we had up to 30 per cent of parents who chose to keep students or their children at home and we appreciate and anticipate that number will increase.
"Schools will remain open and for those children who have no option, whose parents have no option, no child will be turned away from school."
NSW Education Minister Sarah Mitchell says the state will prepare to deliver online learning and will give teachers - particularly those with health concerns - more flexibility to work from home.
"We expect there will be fewer students attending physical campuses," she said on Monday.
"We know teachers will be able to manage that, but there will be others who can work from home."
NSW Health on Monday morning confirmed 136 new COVID-19 cases, bringing the state's tally to 669.
Chief health officer Dr Kerry Chant says the decision to keep schools open is a "practical one".
Pubs, cinemas and churches will be forced to close across NSW from noon on Monday to stem the spread of the coronavirus.
Prime Minister Scott Morrison and state and territory leaders on Sunday night agreed to a staged process starting with a shutdown of "principal places of social gathering".
Australian Associated Press