A Sydney court has cleared the path for the Allianz Stadium demolition to start before the NSW election after a community group and local council lost their last-ditch bid to halt the knock-down.

The NSW Land and Environment Court found the government did not breach its own planning laws for the controversial project and the demolition of the Moore Park stadium could go ahead.

Thousands of chairs have already been ripped from Allianz Stadium as part of "soft demolition" works. Credit:Janie Barrett

Community group Local Democracy Matters and Waverley Council launched legal action against Infrastructure NSW in an attempt to stop the stadium demolition before the state poll on March 23.

The courtroom showdown halted early demolition works and threatened to derail the Berejiklian government's ambition to bulldoze Allianz and build a replacement stadium for $730 million.