Orange's water storage hit a significant milestone with a total combined storage of 35.54 per cent.
The figure is the highest in 12 months.
Orange Mayor Reg Kidd said thanks to the rain and residents' commitment to saving water, the city could soon relax water restrictions from level five to level four.
"This is a fantastic milestone and I want to take the opportunity to thank Orange residents for working together to get us through this incredibly tough time," Cr Kidd said.
"I want to emphasise, we're not out of the woods yet, but we are certainly turning a corner in terms of looking to relax a few of the restrictions we have in place."
Cr Kidd said Council had previously voted to return to level four restrictions once the combined water storage reached 40 per cent.
"We could hit 40 per cent in a matter of weeks, depending on the weather," Cr Kidd said.
"In the last three weeks the combined storage has increased by 6.69 per cent.
"We're currently pumping from the Macquarie River, which has a flow of over 1,800 ML per day at the moment. We're also pumping from our storm water harvesting systems and there is inflow into Suma Park Dam of over 30 ML per day.
"If we get to 40 per cent then we will have a little breathing room over the summer months.
"If we continue to work together to use every drop of water responsibly we can realistically start to look at paring restrictions back to level three if we reach 50 per cent capacity."
The lowest recorded combined water storage level was 21. 42 per cent on March 27, 2020.
"It's great to have such positive news at this time and let's keep watching the weather and keep up the great water saving habits we've all learned," Cr Kidd said.
For water saving information, information on water restrictions and water storage totals head to Orange City Council's website.