A huge police presence already deployed at beach suburbs hit by racial violence between whites and Arab-Australians would be increased to 2,000 to cope with the threat, Ken Moroney, the New South Wales police chief, said.
Dozens of people were injured and arrested in the riots after white mobs set out to "reclaim the beach" from groups of ethnic Lebanese at Cronulla in south Sydney last Sunday, sparking days of revenge attacks.
Intelligence reports indicated that gangs would again target Cronulla as well as neighbouring beaches, others on the central coast and those in the towns of Woolongong and Newcastle to the south and north, Moroney said.
"I would urge people who do not live in these areas to stay away unless they have a good reason to be there," Moroney said. "Our latest intelligence tells us that large numbers of people are planning to go to these areas on Sunday to cause riotous behaviour."
Earlier on Friday, police said that they had arrested 19 people in Sydney overnight as they wielded new powers granted by an emergency session of the New South Wales state parliament.
Checkpoints were set up on main roads in Sydney's troubled suburbs. The wave of arrests followed several incidents, including a Molotov cocktail thrown at police and an officer injured in a brawl.
The arrests were made by a task force using new legislation granting special powers, including the right to "lock down" suburbs, close pubs, enforce alcohol bans and confiscate cars.
John Howard, the Australian prime minister, writing in Australia's Daily Telegraph on Friday, said the violence was caused by people who had "no regard for the law" and those who had "no respect for their fellow Australians".
Howard, who has dismissed suggestions that Australia is a racist society, wrote: "It is clear the best way to deal with the challenge is for everyone to calm down.
"The most immediate - and best - solution is maintenance of law and order."
Despite the attacks, most Australians still had "the proper instincts and decent values", he said. "In the long term we can reflect on whether there are some lessons to be learned or messages to be heeded."
Meanwhile, Cate Blanchett, the actress, led a group of Australian celebrities in a ceremony at Coogee Beach in Sydney to appeal for peace and racial tolerance.
"It's actually very clear and simple," said Blanchett, who stood in front of a banner calling for a "wave of tolerance" to sweep Australia.
"Violence and racism are bad. Whenever they occur they are to be condemned (and) we should not turn a blind eye to them."