The Olympic Stadium and the Sydney Football Stadium will be demolished and rebuilt in a $2 billion overhaul signed off by New South Wales Cabinet.

Work at the Sydney Football Stadium site at Moore Park is expected to start next year, followed by the Homebush Olympic stadium in 2019

Senior government sources described Thursday morning's Cabinet meeting as "robust" with some ministers, frustrated at the length of time it had taken to reach a decision, expressing concerns the handling of the issue had been damaging.

It is understood some also raised concerns about the $2.3 billion price tag, up from former premier Mike Baird's original estimate of $1.6 billion.

The package also includes the cost of rebuilding Parramatta Stadium.

Sydney Football Stadium (L) will be demolished and rebuilt as part of the plan. ( AAP: Dan Himbrechts )

The rebuilt Sydney Football Stadium's capacity is expected to be 45,000 people while the Olympic stadium will hold between 75,000 and 80,000 people.

The decision is expected to be announced on Friday and brings to an end a saga that dragged out for more than 18 months since Mr Baird first detailed his proposal.

That plan would have seen the Olympic Stadium reconfigured to a rectangular venue at a cost of $700 million ahead of a refurbishment of the Sydney Football Stadium.

While the proposal received strong support from the NRL, there has since been furious lobbying by the Sydney Cricket Ground Trust, who control the Sydney Football Stadium, as well as the Australian Rugby Union and Sydney FC to rebuild the Moore Park venue first.

Sports Minister Stuart Ayres backed that option and has spent almost two years tying himself into knots advocating various positions that would get it over the line.

But there has been fierce opposition from some members of Mr Ayres' own cabinet, with some scratching their heads as to why a stadium that was built as a state of the art venue for the Sydney Olympics less than 20 years ago should need such a complete overhaul so quickly.

Opposition Leader Luke Foley supported the rebuilding of the Olympic stadium but said the work at Moore Park was a waste of money.

"I've always said west before east because that's where the people are," he said.

"They will spend hundreds of millions of dollars on a white elephant, on a stadium that won't host grand finals, State of Origins, Bledisloe Cups or the biggest Socceroos qualifiers.

"Why are we doing this? Is the Waratahs vs the Bulls in Super Rugby going to get 45,000 people? They struggle to get 10,000."