More than a quarter of New South Wales was considered at catastrophic risk and lightning strikes set two homes in Sydney ablaze.
"We have seen more than 80 fires across New South Wales today," Shane Fitzsimmons, the RFS commissioner, said.
"The biggest challenge today and into the weekend is the continuing of this hot air mass dominating much of the state."
Grip of drought
The south and southeast of Australia is experiencing an unprecedented heat wave, which has dried out vast tracts of bush and farmland already hit by drought.
Flights were delayed due to the unseasonable heat, thunderstorms, strong winds and the effects of smoke on visibility, air-traffic officials said.
The first "catastrophic" or Code Red warnings - a new category introduced after February's deadly fires - were declared in parts of the two states, under which residents are strongly advised to flee their homes.
Code Red conditions are considered on a par with those experienced in the run-up to Black Saturday, Australia's worst disaster of modern times which killed 173 in the state of Victoria and razed more than 2,000 homes.
Residents cannot be forcibly evacuated but are strongly advised to leave their property on a Code Red day, which signifies a high risk of death or injury and destruction.
More fires have spread across rural parts of Victoria and consumed more than 200 hectares of bushland.
Australia is facing its worst fire danger in four years, with hotter and windier conditions and earlier-than-normal outbreaks forecast, according to government analysis published on Friday.