Level 1 water restrictions will start in the Shoalhaven from Monday, December 2.
The restrictions ban washing down hard surfaces, and require sprinklers and pool hoses to be connected to a timer.
Rainfall in the Shoalhaven has been particularly low recently The region only received 33mm of rain for October and November compared to the long-term average of 140mm for the same period.
Shoalhaven Water acting director Robert Horner asked residents and tourists to seriously consider their water usage.
"The state is suffering from one of the worst droughts we have ever seen, we are lucky here in the Shoalhaven that we are only going into water restrictions now, which will remain until we receive significant rainfall." Mr Horner said.
"Level 1 water restrictions have been triggered by the need to release water from Danjera Dam to top up Bamarang Dam. Bamarang Dam's capacity is currently at 60 per cent and may require another top-up in the future if weather conditions don't improve.
"We are asking the community to think about water consumption and make every drop count."
The Shoalhaven councillors voted to bring in Level 1 water restriction at the Development and Environment Committee on November 5.
Water demand during the holiday period increases by around 40 per cent.