It is likely to produce large hailstones, heavy rainfall that may lead to flash flooding and damaging winds in the warning area over the next several hours. 

Waterspouts are also possible for coastal parts, particularly the Mid North Coast, and these can cause localised increased damage. 

Locations which may be affected include Lismore, Grafton, Port Macquarie, Taree and Tenterfield.

 Hail about 2cm in size was reported with a thunderstorm to the west of Kyogle at about 3:40pm.

Three waterspouts have been reported off the coast at Flynns Beach near Port Macquarie about 4:40pm.

MONDAY 4.07pm: Severe thunderstorms are likely to produce large hailstones and heavy rainfall that may lead to flash flooding in the warning area over the next several hours. 

Drifts of small hailstones are also possible, the Bureau of Meteorology says.

Locations which may be affected include Lismore, Grafton, Coffs Harbour, Woolgoolga, Sawtell and Dorrigo. 

Pea-sized hail about seven centimetres deep was reported at Dorrigo on Monday about noon and 2cm hail was reported with a thunderstorm to the west of Kyogle at about 3.40pm.

The State Emergency Service advises that people should: 

* Move your car under cover. 

* Keep clear of creeks and storm drains. 

* Don't walk, ride your bike or drive through flood water. 

* If you are trapped by flash flooding, seek refuge in the highest available place and ring 000 if you need rescue. 

* Unplug computers and appliances. 

* Avoid using the phone during the storm. *

 Stay indoors away from windows, and keep children and pets indoors as well. 

* For emergency help in floods and storms, ring the SES (NSW and ACT) on 132 500.