The Sydney Fish Market and UrbanGrowth NSW have committed to work together to rejuvenate what is both a Sydney landmark and a key part of the state government's Bays Precinct urban renewal ambition.

The aim is to create, as a top priority, a "re-imagined Sydney Fish Market" as the centrepiece of a proposed Bays Market District on Blackwattle Bay.

The chief executive of UrbanGrowth NSW, David Pitchford, said a "competitive process" for the creation of The Bays Market District would start in 2016.

The Sydney Fish Market wants to maintain its authenticity. Peter Rae

"UrbanGrowth NSW has an ambition to create a new, world-class market precinct and dining destination connected to the water in Blackwattle Bay, and centred around a rejuvenated Sydney Fish Market," he said.

The general manager of Sydney Fish Market, Bryan , said his aim was to maintain the authenticity of market – with its wholesale auction – and retail activity, while improving the amenity, upgrading the linkages to the city, and broadening the offer.