Transport for NSW has sounded a warning that the ambitious housing program being promoted by the Greater Sydney Commission could allow developers "free rein" to increase dwellings across the city without considering transport and other infrastructure.

The blunt appraisal by the transport department comes as the commission, headed by Lucy Turnbull, attempts to balance the competing demands placed on planners in Sydney, with a strong push for more housing rubbing up in places against demands for open space, and health, education and transport infrastructure.

The Greater Sydney Commission, which has the power to determine how many new dwellings councils must approve for development, said in draft district plans released late last year there was a need for almost 190,000 new dwellings built in Sydney by 2021.

That target was above the forecast of 184,300 dwellings prepared by the Department of Planning and Environment.