There are no plans for Griffith to impose water restrictions, according to mayor John Dal Broi.
Many cities and towns across the state are under restrictions, with Sydney under level two restrictions and Orange in the Central West are up to level five restrictions.
Uralla Shire Council in the state's Northern Tablelands is due to run out of water by July, while Armidale has less than a year of water left.
Councillor Dal Broi said while water was a "very precious resource", council did not want to "penalise" those living and working in the city by imposing restrictions.
"At this stage we aren't looking at imposing restrictions unless it comes from the state government and they impose restrictions," Cr Dal Broi said.
"If we were to put restrictions in, who is going to benefit from those restrictions?
"It's just not possible to divert water [to heavily drought-affected areas]... the savings would be minimal."
Cr Dal Broi called the allocation of water council had negotiated from the state government the city's "competitive edge" at the moment and said the allocation was comforting to local industries, who require large amounts of water to operate.
The response comes after The Area News reader Andrew Paterson sent in photos of water being excessively used throughout the district.
Mr Paterson said the photos were a "wake-up call" and a conversation needs to be had throughout the region about water usage.
"There is not an endless supply, it's a limited resource and we've all got to be mindful of it," Mr Paterson said.
"For my mind, the thinking seems to be [that] water is endless.
"It's not just Griffith, it's towns all around... as a wider community across the region we've got to be more sensible."
Mr Paterson said some water users should be more mindful of their usage and cut back on beautification works to reduce water usage.
"We've got to be planning for longer, hotter, drier weather," Mr Paterson said.
"Before we get water restrictions we need to think... of at least stopping this wastage of water."
Cr Dal Broi said council have been running a campaign aimed at reducing water usage and while council staff and community members have noted cases of excessive water usage in the city, excessive water users have not yet been penalised.
"If we are going to preach about being water wise, we as a council have to do the same," Cr Dal Broi said.
"The usage of water is slightly up on last year. Generally the community has been very good [in reducing their water usage]."
"We're not out there hitting them with a fine at this stage... if people are utilising more water they'll end up paying for that."
A Griffith City Council spokesperson said watering of council-owned sporting ovals are done overnight between 10pm and 6am to maximise water retention, with supplementary watering halted until further notice "in recognition of the ongoing drought and state-wide concern over the use of water."
The watering systems used on Banna Avenue will also undergo a council review to maximise watering efficiency.