The NSW and federal governments say a new economic zone around Sydney's second airport will be equipped with a rail connection from the day it opens and be supported by major investments in technology, education and advanced manufacturing.

"This is a historic day," Prime Minister Malcolm Turnbull said after signing a deal with the state government and several local councils on Sunday to create an "aerotropolis" and a rail line.

Prime Minister Malcolm Turnbull announces the western Sydney ‘‘city deal’’ with NSW Premier Gladys Berejiklian and western Sydney mayors on Sunday. Credit:Jessica Hromas

"We're putting huge resources behind the development and planning of [a] western parklands city."

But Labor has criticised what it says is the government's tardiness in planning for a rail connection to the airport and noted that only $100 million in funding for a business case for a project likely to cost several billion dollars was committed in Sunday's announcement.