Officials confirmed the party missed Wednesday's 12pm deadline to nominate some candidates, with the state director blaming a lack of resources for the blunder.
Reports suggest the list of councils where voters might not be able to pick Liberal candidates include the Northern Beaches, Sutherland, Hornsby and Lane Cove.
The party's state director Richard Shields admitted the mistake and apologised to the Liberal-endorsed candidates that had not been nominated.
"With the secretariat resources that we had available unfortunately we were unable to nominate in all of the local government areas that were put forward by the state executive," he said.
"Close to 300 Liberal candidates were nominated with the NSW Electoral Commission, including in areas like Parramatta, Strathfield, Blacktown, Inner West and Bayside where we did not run in 2021."
NSW Opposition Leader Mark Speakman would not offer comment on how the mistake was made, and called on Mr Shields for a full explanation.
"My wish was to have Liberal-endorsed candidates in as many council elections as possible, people are entitled to have the choice of voting for a Liberal candidate if that's what they wish to do," he said.
Sutherland Shire Mayor Carmelo Pesce, a longtime party member, said the move did not surprise him "one little bit".
"The previous state executive worked really hard to make sure that every council had Liberal representation and we said we won't do what we did in the state and federal party where we started endorsing people late," he told Sydney radio 2GB.
"This has been the biggest shambles I've ever, ever, ever seen and I'm embarrassed to know that I've been a part of it."
NSW Greens MP Amanda Cohn, who was formerly on the Albury Council, cheekily confirmed her party had not made the same mistake.
"Communities across NSW can be reassured that all 376 Greens local government candidates and 22 mayoral candidates got their paperwork in," she said.
"There are excellent candidates to vote for on September 14."
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