New South Wales Waratahs produced a much-improved second half to defeat the Blues in dramatic fashion at Allianz Stadium, Bernard Foley landing a penalty goal after the siren to give the home side hope for the season where there might have been none at half-time.

The Blues seemed set to end their 10-year drought in Sydney when they led at the interval, the visitors having reaped maximum reward from slack play and errors from the Waratahs. But Blues captain Ali Williams agreed when asked after the game whether his side had become "lethargic in the second half", and the home side was better focused having seemingly received a roasting at the interval from coach Michael Cheika.

"We stopped running, we started walking and watching the game," Cheika told host broadcaster Fox Sports after the break. "There's nothing we're doing as far as game's concerned that has to change. We've just got to speed up the game. Play faster, be more urgent and the game will flow for you."

The Waratahs showed the benefit of the coach's input as they were quick out of the blocks in the second half, Israel Folau scoring a try within two minutes after good work from Foley and Ben Lucas - even thought the final pass from Lucas back across his body looked forward.

Foley then levelled the scores when he converted his own try, the fly-half burrowing over after a period of sustained pressure, and he kicked the Tahs into the lead with a penalty awarded after George Moala was offside at the ruck.

The Waratahs almost immediately allowed the Blues back into the game - Chris Noakes landing a penalty for offside to level the game at 27-27 - but the game still had a twist.

Foley first missed a drop goal but he landed the winning penalty goal, from in front of the posts, 34 metres out, after Culum Retallick was offside at a ruck.

"That first half, we started strong and played some good rugby but we let them back in the game thanks to knocking off and not working hard enough," Waratahs captain Dave Dennis said after the final whistle. "The second half was pleasing. They're a good said, and to get that win means a lot for our group."

Dennis said the Waratahs simply had to "stick to our game plan and to work hard" if they were to achieve success through the season. "As soon as we drop off or go away from our game plan, we're in trouble. So we went back to that. We're still a bit rusty in areas, but it was a good result. We had to dig deep in the second half, but it's all about working for each other."

Waratahs fans seemed set early to enjoy the Sunday afternoon sunshine, Drew Mitchell scoring his first try of the season to cap a wonderful first-phase move off the top of a lineout after Brendan McKibbin had run a loop and Adam Ashley-Cooper and Folau had straightened the attack.

Mitchell was frequently involved at this point, and he looked dangerous as the Waratahs dominated the opening quarter of the match. But the home side seemed to lose energy through the stanza and the Blues struck back.

Hooker James Parsons scored a try to capitalise on poor tap ball from a Waratahs lineout, Noakes scythed through a gap between Sitaleki Timani and Ashley-Cooper in the New South Wales defence, and then Charles Piutau dotted down after Moala had taken advantage of lazy cover running from the Tahs to chase a kick downfield from Piri Weepu.

But the Blues' inability to create opportunities of their own cost them in the second half as the Waratahs reduced the errors and improved their execution rate

"Individually we made too many mistakes," Williams said after the game. "We couldn't apply pressure over a distance of time. It's frustrating, but it is what it is when you get to Sydney; it's a hard battle."