The rate of smoking among young people in Australia has dropped to a record low, and there is hope it could be the early signs of a potentially smoke-free generation.

Key points: Number of adolescents currently smoking reduced by more than 70 per cent in 20 years

Number of adolescents currently smoking reduced by more than 70 per cent in 20 years In 2014, 6.7 per cent of teens described themselves as heavy, light or occasional smokers

In 2014, 6.7 per cent of teens described themselves as heavy, light or occasional smokers Researchers say data shows effectiveness of plain packaging laws, price increases and public education campaigns

The latest figures out of New South Wales show in the past 20 years, the number of adolescents currently smoking has reduced by more than 70 per cent.

The data is being used to highlight the effectiveness of plain packaging laws, price increases and public education campaigns.

"Twenty years ago we had smoking amongst 12- to 17-year-olds sitting at about 23.5 per cent and we're now as low as 6.7 per cent," said Anita Dessaix from the Cancer Institute of New South Wales.

She is one of the authors of the new report, published in the journal Public Health Research & Practice.

"There's some key policy items that stand out," Ms Dessaix said.

"We know that increasing the price of cigarettes is extremely effective, and continued and sustained investment in public education campaigns have been quite effective."

Other factors also include plain packaging, the expansion of smoke-free areas, and the ongoing monitoring of bans on the sale of cigarettes to minors.

"About 20 years ago, the average age of initiation was about 14 years, but we have seen an increase to about 16 years of age," she said.

'Worst nightmare' for tobacco industry

The National Heart Foundation's tobacco control spokesperson Maurice Swanson agrees that the findings are significant.

"It's the world's worst nightmare for the tobacco industry, it's like a recession," he said.

Mr Swanson said stopping people smoking at a young age has had a significant impact on reducing overall rates of smoking across all ages.

"It's an important part of the package because the tobacco industry relies on recruiting new consumers to make up for the older smokers who are either giving up or dying as a result of their smoking."

And according to Mr Swanson, a continued decline in smoking rates across all age groups has the potential to save the Australian Government billions of dollars.

"We can look forward to a future where many fewer health dollars are used in the treatment of smoking-caused disease," he said.

But Ms Dessaix said to get to that point, governments and health authorities need to continue investing.

She said authorities must be vigilant in monitoring tobacco promotion marketed at young people, like flavoured cigarettes or filters even video games.

"We do know from some studies that for every hour that young people spend playing video games on the internet, the likelihood of exposure to tobacco products increases by about 8 per cent," she said.