The 1961 NSW Federation Cup was the fifth edition of the NSW Soccer Federation's premier soccer cup. This was the third tournament sponsored by W.D. & H.O. Wills and called the "Craven 'A' Cup" after their popular cigarette. The cup was contested by all twelve first division clubs and four second division clubs. The £1000 prize money was divided among the first four placings, with first place receiving £600, second place £250, third place £100 and fourth place £50.[1][2][3]
Bankstown were the defending champions, having beaten Canterbury-Marrickville 2–0 in last year's final. They were eliminated by Auburn in the quarter-finals.
The final was played on 15 October 1961 between Sydney Hakoah and Canterbury-Marrickville. Hakoah won the match 2–0 to claim their second title.