The app's six million users are already tipped off if they've crossed paths with a case by a red dot that appears next to the venue in their recent check-in history.
The upgrade means it will be easier to find out if a user has been exposed to a case.
"This is an additional service not seen in any other state or territory," Digital and Customer Service Minister Victor Dominello said on Friday.
Those who are alerted of their exposure should get tested, but don't need to self-isolate unless instructed by NSW Health.
Contact tracers would continue to contact positive cases and close contacts to provide them with testing and isolation advice, said Health Minister Brad Hazzard.
Meanwhile, the percentage of eligible adults fully vaccinated against COVID-19 in NSW has reached 87 per cent.
NSW recorded 268 new locally acquired COVID-19 cases and two more deaths on Friday, with more than half of them detected outside Greater Sydney.
In the 24 hours to 8pm on Thursday, there were 54 positive tests returned in the Hunter New England Local Health District, 52 in the Murrumbidgee area and 13 on the state's Mid North Coast, with additional cases in the Illawarra Shoalhaven region and Southern NSW.
An unvaccinated woman in her 90s died at a Tarrawanna aged care facility, north of Wollongong, where she acquired her infection, and a man in his 70s died at an Albury aged care facility in Albury, where he acquired his infection.
He had received one dose of a COVID-19 vaccine.
There have been 566 COVID-19 related deaths in NSW since the start of the pandemic.
There are 363 people hospitalised with the virus - 80 in intensive care and 32 requiring ventilation.
Some 93.5 per cent of NSW residents over 16 have received at least one vaccine, with 87 per cent fully vaccinated.
Of those aged 12 to 15, 78.7 per cent have had one dose and 56.7 per cent have received both.
Meanwhile, a pilot program for rapid antigen home testing kits in public schools will begin in Albury, near the Victorian border, next week.
"I want to see disruption to our students' education from COVID reduce, while still keeping schools safe places to learn," Education Minister Sarah Mitchell said on Friday.
"This requires us to deploy every tool available to balance the risk."
The kits will be handed out by schools for use at home by staff and students who have to do a test twice a week as part of community surveillance.
They will also be used for close contact testing to identify positive cases on school sites.
"Our best line of defence against this pandemic remains vaccinations, and until all students are eligible for one we must continue using measures like (rapid test) kits to keep schools safe," Ms Mitchell said in a statement.
However, anyone who gets a positive result will have to get a standard test straight away to confirm the result.
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