One of Australia's tallest chimney stacks has been demolished in a controlled explosion at the site of a former coal-fired power station.

Key points: The 200-metre chimney at the former Port Augusta power station has been brought down

The 200-metre chimney at the former Port Augusta power station has been brought down It was demolished through a controlled explosion

It was demolished through a controlled explosion The stack was the second-tallest structure in SA

The 200-metre stack at the Northern Power Station site once towered over the outskirts of Port Augusta in South Australia's north, and became a local landmark.

Constructed in 1984, the chimney has gone up in a cloud of dust, after it was demolished this morning about 8:00am, more than two years after the closure of the power station.

The structure was the second tallest in the state, reaching a height almost 70 metres above Adelaide's most prominent building.

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A 500-metre exclusion zone was established around the site to protect onlookers from the explosion, which was carried out by Precision Demolition in conjunction with Flinders Power and McMahon Services Australia.

Locals lined the streets to watch it be brought down, with the stack slowly tipping and crashing to the ground, billowing dust hundreds of metres into the air.

Children also stood beside the local highway with their parents to watch the spectacle on their way to school.

"We're moving away from coal and also in a place we're going to solar," one local said.

"But at the same time we're watching out there thinking we had relatives that worked out there. All their work's just gone in seconds."

It is the final major demolition planned for the site which closed in May 2016, resulting in about 400 workers to lose their jobs at both the power station and the associated Leigh Creek coal mine in the state's Far North.

Dust clouds rise from the explosion. ( ABC News: Khama Reid )

Since the closure, the town has been plagued by health concerns associated with dust from the former power station site.

A spokesperson for Flinders Power said there were "no complications" with the felling.

"The structure was the last and most anticipated of seven demolitions — part of the ongoing effort to clear the site and make it safe and stable for future industrial use," McMahon Services said in a statement.

Sorry, this video has expired Port Augusta power station chimney demolished

At the time of closure, its former operator Alinta Energy said the power station had become unviable.

A year ago, explosions brought down two giant boilers at the site, while an 80-metre stack at the nearby Playford Power Station was demolished in September 2016.

Work on the site is expected to be completed early next year.