Legal action possible over stadium rebuild

The NSW premier is unfazed by the threat of legal action from a community group over the redevelopment of Sydney's Allianz Stadium.

Demolition work on the Moore Park structure is due to start this week, as part of the stadium's controversial $730 million rebuild.

But local residents are threatening to take the state government to court if the knock-down proceeds, claiming it did not properly consult the community as required.

"We have a strong legal case to challenge the demolition and are demanding the government immediately halt the project," treasurer of Local Democracy Matters Chris Maltby said in a statement on Tuesday.

"This is an important issue in the local area, and people across NSW have expressed their strong support."

Both Labor and the Greens oppose the controversial development.

Opposition leader Michael Daley claims the government has failed to listen to the locals and is rushing into the project, noting that the stadium's community consultative committee will meet for the first time on Thursday.

"This is a disgraceful abuse of a proper planning process," Mr Daley said in a statement.

But NSW Premier Gladys Berejiklian said she is not worried about the threat of legal action.

"It's a democracy and people can exercise whatever rights they wish," she told reporters.

"(But) I'm absolutely confident that we've followed all the right processes and we're at this important point."

She believes the new stadium will "change NSW for the better".