The incident occurred as Labor MPs were casting their votes in the leadership ballot between Strathfield MP Jodi McKay and Kogarah MP Chris Minns.

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Ms McKay entered the caucus room accompanied by 19 MPs, while Mr Minns had 13 MPs in his support group.

Labor is expected to announce the new NSW leader in a press conference shortly after 5pm, after a longer-than-expected process to verify the rank-and-file votes.

Sources from both camps say Ms McKay has likely won the caucus vote.

Both Mr Buttigieg and Ms Mihailuk confirmed that the incident was in relation to an interaction between Mr Buttigieg and Shellharbour MP Anna Watson inside the partyroom, but they gave conflicting accounts.

Mr Buttigieg - who supported Ms McKay - claimed he had a "pre-existing pairing arrangement" with Ms Watson to show each other their votes.

"I literally walked over to her and showed her my vote. I leaned over to show her my ballot paper and I looked at hers," he said.

While Labor's leadership ballot is technically a secret ballot, pairing arrangements are common among members of Labor's right faction, to which all three MPs belong.

MPs who agree to pair show each other their ballots as a way of verifying who each other voted for.

Ms Watson, who entered the caucus room with Mr Minns and his supporters, declined to comment on this fact, telling the Herald: "I don't talk about what happens in the caucus room".

Ms Mihailuk claimed she watched Mr Buttigieg "fully standing over" Ms Watson while the caucus vote was underway.

"There's no way that's a normal pairing arrangement. He was fully standing over her. She was sitting on the lounge and he was standing right on top her," she said.

"[Ms Watson] looked really intimidated to me. I checked if she was okay, and she said she wasn't okay."

Ms Watson confirmed Ms Mihailuk had inquired after her wellbeing, and said she left the party room shortly after she cast her vote to return home to take care of an ill family member.

Both Mr Buttigieg and Ms Mihailuk said they then left the caucus room to check on Ms Watson because they were "concerned" for her welfare, but ultimately clashed with each other in front of the media pack.

Auburn MP Lynda Voltz, who was sitting next Ms Watson in the caucus room, said she didn't see anything unusual in the interaction between Mr Buttigieg and Ms Watson.

"I was sitting next to Anna and if she was being intimidated, I would've noticed," Ms Voltz said. "She certainly wasn't."

Ms McKay and Mr Minns will have an anxious hours-long wait before the result of the leadership ballot is known.

Labor officials and scrutineers have started verifying the 11,000 rank-and-file ballots against membership rolls, with counting expected to begin around 4pm.

After the members' votes have been counted, the votes of Labor's 50 MPs will be counted. The results of both ballots will be given a 50 per cent weighting in the outcome.