The Blayney Shire village edged out eight other finalists, including Kangaroo Valley and Huskisson to take the top honour.

Decided by popular vote, towns in the 'Tiny' category must have less than 1500 residents.

Judges praised Carcoar as "a wonderful piece of living history and a brilliant place to recharge the batteries, step back to yesteryear and immerse in local hospitality."

Carcoar will now represent NSW at the Australian Top Tourism Town Awards to be held later in the year.

Orange and Molong were finalists in the two other award categories - Top Small Town and Top Town, but missed out on a prize this year.

Berry on the South Coast won Top Small Town and Mudgee won Top Town.

The award announcement was made on the final day of a three-day tourism conference in Orange attended by more than 180 delegates from across the state.

The Local Government NSW Destination and Visitor Economy Conference, hosted by Orange, Cabonne and Blayney Shire Council's, is estimated to have injected $250,000 into the local economy and was 'a coup' for the region, Orange mayor Jason Hamling said.

Delegates made visits to sites in and around Orange including Millthorpe, Manildra Flour Mill, Pioneer Brewing, Molong and Nashdale Lane Winery, and heard from industry professionals on topics including using 'influencers' to attract tourists, and encouraging electric vehicle drive tourism.

Cr Hamling said the conference had been an opportunity to hear from experts in the tourism industry.

"From 2015 to 2019 our tourism industry almost doubled from 773,000 visitors to 1.3 million visitors. The average length of stay also increased and is now 3.5 nights. We have been very successful in putting the Orange region on the map," Cr Hamling said.

"COVID-19 has opened some metro eyes to the regions. What that might look like in 10 years time is an open question.

"At this conference, we were given insights from some very bright people from the visitor economy frontline.

Blayney Shire Mayor Scott Ferguson said the region had a great tourism product and securing the conference was recognition of that.