Gladys claims historic third term
UPDATE: Gladys Berejiklian has declared victory and is now the first woman to be elected premier of NSW.
That National party performed exceptionally well despite predictions they would be hit hard by federal drama.
The gaffes and missteps of the past week hit Labor hard at the polling booths with the opposition being hammered in both marginal seats and homeland territory.
Fears of a wipe-out for the National Party in the drought-ravaged bush did not eventuate, with the party holding most seats despite significant swings.
NSW SET FOR MINORITY LIBERAL RULE
Gladys Berejiklian is set to be returned as NSW premier, but her Liberal/National coalition government will lose its majority, a Nine/Galaxy Exit poll indicates.
The poll of marginal seats shows a swing to Labor of 2.3 per cent, but it's not enough for it to win the 47 seats needed to form a majority government the 93-seat parliament.
The exit poll shows a 50/50 two-party preferred split, with the Berejiklian government losing six of its 52 seats.
Two of those would be in Sydney, while the other four are in regional NSW. Labor needs to pick up 13 seats in Saturday's election to clinch an outright majority, but the exit poll indicates that is unlikely.
A special Newspoll, published in The Weekend Australian, suggested the coalition was ahead of Labor 51-49 on a two-party preferred basis.
Ms Berejiklian earlier conceded the NSW election would be tight as she seeks to become the state's first ever popularly-elected female premier.
More than 1.3 million have already made their decision and voted early in what's tipped to be one of the closest elections in decades.
Many pundits had predicting a hung parliament, which would force either party to negotiate with independents and minor parties to form government.
Ms Berejiklian was accompanied by a media scrum when she cast her vote at Willoughby Public School just before 9am.
"It is going to be a tight race but it is up to the people of NSW to decide," she told reporters.
"I hope they will decide to allow my government to continue to take NSW forward and provide a strong budget, a strong economy and not allow us to go backwards."
She said there was "no way" her government had been perfect. "Is there more we could have done? Of course, there is but … I know (NSW) will be much better off if they choose to vote Liberals and Nationals today."
Mr Daley spend the day visiting Sydney polling booths: "This is the day the people of NSW get to take their lives back after eight years of a chaotic government that has taken them for granted."
BALLOTS 'QUARANTINED' IN POLLING BOOTH BALLS UP
Sky News has reported that ballots in the Sydney inner west seat of Strathfield have been quarantined after a Liberal volunteer was allegedly allowed to mark off names by mistake.
Strathfield is a marginal seat currently held by Labor.
Sky News said the volunteer turned up at a booth in Croydon in order to campaign for Liberal candidate Philip Madirazza.
NSW Electoral Commission staff later realised the woman was a Liberal volunteer.
The ballots have now been sealed off and will be counted last, with Labor expected to make a formal complaint.
KNIFE-EDGE SEATS TO WATCH
While there are 93 seats in the Legislative Assembly, the lower house, really only a handful matter. These are the ones which are the most precarious for the Coalition and could deliver victory, or at least minority government, to Labor.
In Sydney, Penrith, East Hills and Coogee are the seats to watch. East Hills is one of the most marginal seats where just 372 votes divided Liberal and Labor in 2015. It was also one of the most controversial battles of that election when thousands of pamphlets appeared spreading outrageous and false accusations about Labor's Cameron Murphy. Mr Murphy is back and has said the smears weren't going to stop him running again.
The Liberals are quietly admitting defeat in Coogee, in Sydney's east, where delays to the light rail has angered locals.
The Nationals are feeling the heat in Barwon and Murray from the Shooters, Fishers and Farmers (SFF) party. They've already lost Orange to the SFF in a by-election. Tweed and Lismore, in the state's north east could move from the Nats to either Labor or the Greens. But the Nats could win back Ballina from the Greens.
MICHAEL DALEY DEFENDS FINAL WEEK OF CAMPAIGNING
NSW opposition leader Michael Daley has defended his final week of campaigning, having stumbled through a leadership debate and being forced to apologise over comments about Asian immigration caught on video at a pub forum last year.
"We are human, we make mistakes, but the most important thing is you pick yourself up," he said.
Both Mr Daley and his opponent, NSW Premier Gladys Berejiklian, acknowledged the race for the leadership was close.
Mr Daley said he felt confident that the Liberal government's failure to deliver their light rail project on time and on budget, and the controversy surrounding the destruction of Allianz stadium would be enough to swing voters.
He believes concerns about light rail and stadium redevelopment was enough to sway voters against the Liberal-National government.
"They've run a very negative campaign because they have no story to tell," he said.
"Everything they've touched has turned to misery or destruction."
Throughout the day Daley stopped by polling booths in Heathcote and in the marginal electorates of East Hill and Penrith.
- Additional reporting by Phoebe Loomes and AAP.