The office of Lieutenant-Governor was created in October 1786, to act as a deputy to the first Governor of New South Wales, Captain Arthur Phillip.

Until the mid-nineteenth century, Lieutenant-Governors also had responsibility for the administration of other parts of the continent that were initially subordinate to the colony of New South Wales.

The Lieutenant-Governor subsequently took on a legislative role, with a seat on the first Legislative Council of New South Wales in 1824, but this practice ceased as the powers of the Governor of the state evolved.

Initially, the office was filled by military officers but since 1872 the role has been filled by the Chief Justice.

The powers and functions of Lieutenant-Governor are set out in the New South Wales Constitution Act 1902.

Section 9B provides that there shall be a Lieutenant-Governor and an Administrator of the State. If the Chief Justice is the Lieutenant-Governor or if there is a vacancy in the office of the Chief Justice or the Chief Justice is unavailable the next most senior Judge of the Supreme Court who is for the time being available shall be Administrator.

Under Section 9C, the Lieutenant-Governor or Administrator assumes the administration of the government of the State if there is a vacancy in the office of Governor or the Governor is unavailable. In that event the powers and functions of the Governor are vested in the Lieutenant-Governor or Administrator, as the case may be.

Under Section 9D, the Governor, with the concurrence of the Premier of the State, may appoint the Lieutenant-Governor or Administrator to be deputy in the event he or she is absent from the State or from Sydney but not the State, or is suffering from illness. In that capacity the incumbent is able to exercise and perform all the powers and functions as Governor of the State, except the power to dissolve the Parliament of the State and to appoint a new Ministry.