NSW Health officials are warning community transmission of COVID-19 is at a “critical point” after three new cases developed in connection to a man who visited a busy south-west Sydney pub last week.

The man, who tested positive for COVID-19 after visiting the Crossroads Hotel in Casula on July 3 has now had three members of his household test positive.

It is not clear what the relationship is between the household contacts, but health authorities said the three tested positive last night and are now isolating.

Jeremy McAnulty appealed for anyone who attended the hotel last week to immediately self-isolate, come forward for testing and monitor for symptoms.

“There’s been recent community transmission of COVID-19 in NSW and so we’re at a critical point in the fight to contain the virus,” Dr McAnulty said.

The man, from the Blue Mountains, and a woman unconnected to him who visited the hotel that night have been diagnosed as positive cases, sparking a widespread investigation and appeal for people to come forward for testing.

A pop-up clinic has set up in the hotel’s car park and will be open until 4:00pm today.

Long lines of cars were seen at the venue today, as patrons queued up for testing.

The woman was recorded as a confirmed case earlier in the week on July 8.

Dozens of cars wait in line at a pop-up testing clinic at the Crossroads Hotel in Casula. Photo: ABC News/Jesse Dorsett

The hotel remains closed for deep cleaning and contract-tracing is underway.

Seven new cases were confirmed in the latest health update, including five returned travellers in hotel quarantine.

The other cases are the Blue Mountains man and a traveller from Melbourne who tested positive after travelling from Victoria in a caravan to Sutherland.

The three new cases linked to the Blue Mountains man will be included in the health statistics tomorrow, officials said.

The total number of recorded cases in NSW has now reached 3,285, based on 1,024,410 tests.

-ABC