Sydney’s state: Abbr.

NSW

This Australian state is home to the Blue Mountains and borders Victoria to the south.

This clue asks for the abbreviated name of the Australian state where Sydney is located. "Sydney’s state" directly refers to New South Wales, which is commonly shortened to "NSW" in crosswords and official contexts. The "Abbr." tag signals that the answer is an abbreviation rather than the full name. It’s a straightforward geography-based clue with no wordplay—just a test of knowing Australian states.