Sri Mandir at Auburn, which is more than three decades old, was attacked by two men, who were wearing balaclavas or ski masks, on the night of March 19.
The attackers were caught on CCTV firing shots at the temple. No one was killed or seriously injured in the incident, which created panic among the temple`s priest and worshippers, local media reported.
A police spokeswoman was quoted as saying by the `Sydney Morning Herald` newspaper that detectives were working closely with the community as part of investigation into the incident.
Rohit Revo, a Sydney resident and editor of a local newspaper `The Indian`, said the footage of the attack was handed over to police, but nothing has been done to solve the issue.
"Few bullets hit the wall at the temple entrance, just a feet away from the main door. One of the bullets grazed through the wall and ricocheted hitting the emergency door on the side of the temple," he was quoted as saying.
"A bullet was also fired on the roof of the temple which found its way through the false ceiling inside the temple.
Looking at the bullet marks on the temple walls suggests that specialised big bullets were used in the operation," he said.
Normal bullets are of a very small width but these bullets have created bigger holes on the walls, Revo said.
"Neighbours are also sick of the escalating violence and have extended silent support to the temple by sending them e-mails etc but fear speaking in the public," he said, adding the recent incident was not the first one as the temple has been attacked several times since 2004.
Last November, some people armed with metal bars had smashed two windows of the temple, when six worshippers were inside.
The temple`s priest Jatinkumar Bhatt claimed that he had also been harassed by youths in the past, but the latest shooting incident left him scared.
"I have a family as well, three kids and my wife," he said. "Throwing eggs and bottles is an ongoing process but this bullet really put us in a panic."