The new legislation is aimed at reducing exposure to second-hand smoke and builds on by-laws for smoke-free commercial outdoor dining areas which have already been adopted by many local councils.
The bans apply to any ignited smoking product, including cigarettes, pipes and water-pipes.
The new bans join existing bans on smoking in a number of other public areas, including children's playgrounds, sports fields, public swimming pools, the entrances of public buildings and public transport stops and stations.
Commenting on the legislation earlier in 2015, NSW Health Director of the Centre for Population Health, Dr Jo Mitchell, said, "there is no safe level of exposure to second-hand tobacco smoke. Research has shown individuals in typical public outdoor dining areas may be exposed to high levels of second-hand smoke.
"Creating smoke-free outdoor areas reduces exposure to second-hand smoke and can support those who have quit and are trying to quit. It also makes smoking less visible to children and young people."
Scott Walsberger, Tobacco Control Manager at the Cancer Council of NSW has praised the NSW Government on the introduction of the final phase of the smoke-free laws which allowed the NSW community and the commercial industry three years to prepare for.
Walsberger said the Council Council of NSW are delighted that second-hand smoke is no longer a worry for patrons, staff and the NSW community.
NSW Health states that proprietors and managers will be required to stop people from smoking in smoke-free areas, and individuals found to be breaking the law will be fined $300, with businesses also facing a $5,500 penalty.
Authorised inspectors will be enforcing the ban by monitoring outdoor dining areas.