Chief Justice Andrew Bell delivered the warnings in a speech at the NSW Law Society's opening of term dinner on Wednesday night.
With 8.5 million people and an economy worth $700 billion, NSW had fewer than 300 judges and magistrates, he said.
"Our judges and magistrates can only be stretched so far. And overstretched they are, both in terms of numbers and resourcing," he told the dinner guests.Â
"The pool of their undoubted goodwill and physical and emotional capacity is not infinitely deep."
Some Local Courts were dealing with over 140 matters a day which was "unsustainable," he said.
"The vital work undertaken by magistrates and the other members of the state's judiciary is an essential service that must be properly and meaningfully valued as such and properly resourced."
Chief Justice Bell criticised a NSW government decision to freeze public sector wages for two years. (Nikki Short/AAP PHOTOS)
The chief judge criticised a May 2023 decision by the NSW government to freeze public sector wages, including judges and politicians, for two years.
"The state government's current two-year freeze on judicial salaries which, unless corrected, will result in a 10 per cent reduction in the real wages of the judiciary," he said.
In May, the NSW government said the wage freeze would rein in expenditure and save an estimated $260 million over four years.
The speech comes ahead of the 200th anniversary of legislation that took effect on May 17, 1824, creating the NSW Supreme Court and appointing the first chief justice.
The milestone will mark 200 years of the rule of law in the state, the chief judge said.
"In a world in which there is much global uncertainty and insecurity, the rule of law is more important than ever," he said.
"At its simplest, it is the opposite of the arbitrary abuse of power and the rule of autocratic dictators and populists."
After 200 years, the court remained respected by the NSW community in "a litmus test for the health of the rule of law," the audience was told.
This contrasted to the United States where a disturbing trend of Democrat and Republican-appointed judges resulted in a decline of trust in that country's Supreme Court, the chief judge said.
He admitted some changes by the NSW Supreme Court had been too slow, for instance, with the first female justice appointed in 1987 and only one other being appointed after that.
However, more women were now joining the legal profession with two-thirds of practitioners under the age of 35 and almost 45 per cent of the state's judicial officers being female, he said.
As part of the bicentenary, the NSW Supreme Court will offer mini-internships with a judge to Indigenous students or young practitioners, the audience was told.
"There are some outstanding Indigenous lawyers in our profession but they are far too few, and a great burden is placed upon them," Chief Justice Bell said.
He highlighted the defeat of the voice referendum in October 2023, saying that "more, not less" now needed to be done to address high levels of Indigenous incarceration, especially among youth.
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