More than 17,000 runners registered to tackle the gruelling 42km course, which kicked off at Milsons Point on Sunday before crossing the Harbour Bridge and finishing at the Sydney Opera House.
The number of runners was more than double those who took part in Australia's previous biggest marathon, held in Melbourne in 2019 with 8100 runners.
Moroccan long-distance runner Othmane El Goumri, age 31, claimed the men's marathon title with a time of 2:08:20.
The women's gong went to US long-distance runner Betsy Saina, 35, who clocked a time of 2:26:47, just beating Ethiopia's Rahma Tusa Chote who came in breathing down her rival's neck with a time of 2:26:53.
Sinead Diver and Brett Robinson won the Australian titles, with Diver, 46, finishing in eighth spot in 2:31:27 - almost nine minutes ahead of fellow Victorian Kate Mason.
Robinson, 32, was the first non-African finisher in eighth spot in 2:23:05 - more than 15 minutes slower than the national record he set late last year in Japan.
Australia's Madison de Rozario took out top honours in the women's wheelchair marathon with a time of 1:59:41 in her Sydney Marathon debut.
The 29-year-old West Australian previously won the TCS London Marathon in 2018 as well as earlier this year, and took first place at the TCS New York City Marathon in 2021.
First place in the men's elite wheelchair race went to Canadian Josh Cassidy, who crossed the finish line in a time of 01:41:52, also on his debut in Sydney.
The event was vying for inclusion as an Abbott World Marathon Major, alongside iconic races in New York, Boston, Chicago, London, Tokyo and Berlin.
Last year, Sydney became the first marathon in the southern hemisphere to be given Platinum Label status by World Athletics, and it is now in its second year of a three-year candidacy period to become a major marathon.
Race director Wayne Larden said he was grateful to the runners who travelled from afar to participate, as well as Sydneysiders.
"Achieving the record of Australia's largest marathon is a testament to the passion and dedication of runners from all over the world, coming to Sydney to support our bid to become the next Abbott World Marathon Major," he said.
Tourism Minister John Graham said Sydney had a long history of hosting major international sporting events.
"No city in the world has a greater combination of natural beauty and iconic infrastructure for hosting a marathon than Sydney," he said.
Runners were met with warm temperatures on Sunday morning with Sydney a comfortable 20C about 7am, heating up as the day wore on.
The event included five races - a half and full marathon, a wheelchair marathon, a 10km bridge run and a family fun run.
To help raise the marathon's profile, four spectator sites were set up in Pyrmont, The Rocks, Surry Hills and Moore Park.
The sites offered free coffee, food trucks, custom sign workshops, DJs, drag queen performances, prize giveaways and large screens broadcasting the marathon live.
Police praised the behaviour of runners during the race, with no major incidents reported.
The heat kept paramedics busy, with NSW Ambulance officers treating 32 people who required medical attention, with 17 patients taken to hospital via ambulance, seven in a serious condition.
12°C