Sharks up to four metres long have been spotted around the carcass of the whale at Bulli.
Overnight the carcass has washed up against the rock platform on the northern side of Bulli Point, drawing a crowd of curious onlookers.
Surf Life Saving Illawarra duty officer Anthony Turner said multiple sharks are milling around the carcass -one of which is four metres long.
"There are definitely some large sharks circling around and munching on the bits and pieces that are falling off the whale," Mr Turner said.
"We're putting out the warning that between Sandon Point and Bulli definitely don't go surfing, swimming or diving while the whale is in the local area."
Mr Turner said surf life savers will be monitoring the beach from the land, water and even the air via drones to ensure that no-one is in the water near the carcass.
He said Wollongong City Council officers were on scene at Bulli to assess how to remove the carcass.
Even after the carcass has been removed the beach will remain closed for some time.
"With the remnants of the whale and the oil and bits and pieces in the water, we're highlighting the fact the beach will remain closed for an extended period of time because the sharks will linger around due to the scent still in the water," Mr Turner said.
"Sharks are scavangers, so they're still going to be looking for something to eat."
Surfers, swimmers and divers have been warned to stay out of the ocean at Bulli, where a whale carcass has prompted a shark feeding frenzy.
Three large sharks got to work on the carcass as it floated past Bulli ocean pool, about 150m out at sea, about 4.30pm Thursday.
Numerous passers-by mistook the whale for an overturned boat and raised the alarm with authorities.
Surf Life Saving Illawarra duty officer Anthony Turner confirmed the object was a whale carcass.
The thrashing from the feeding was visible to onlookers watching from shore - a sign of the sharks' size.
"It was actually quite spectacular to watch," Mr Turner said. "Nature at its best."
"But people need to exercise caution and stay out of the water while they're feeding. Even after the whale is gone, there will still be remnants in the water."
At last light the whale was pressed up against the reef break known as Peggy's, at the northern end of Bulli Beach.
Unconfirmed reports are that the feeding sharks are tiger sharks.
Authorities will monitor the whale's progress on Friday morning.
"It's likely it will wash up sometime tomorrow morning, just depending on the tide and winds," Mr Turner said.