More than 30,000 hectares of Crown land and state forests on the western side of the Blue Mountains are set to become a new state conservation area and eco-tourism and adventure destination.
Key points:More than 30,000 hectares of land will be turned into a state conservation areaThe government will invest $50 million to create an eco-tourism and adventure destinationThe new reserves are expected to attract an additional 200,000 visitors a year
The area is around twice the size of the Royal National Park and includes the Gardens of Stone, north of Lithgow, which is known for its sandstone cliffs, rock pagodas and canyons.
NSW Premier Dominic Perrottet today announced a $50 million investment in what he called a great day for the conservation of the area.
The funds will be used to build an adventure experience that will feature Australia's longest zipline, a rock climbing route and an elevated canyon walk.
"This new set of reserves will improve access to this spectacular region, attracting domestic and international tourists," Mr Perrottet said.
"This is going to be the most important environmental announcement this government has ever made and will ever make. This is legacy-leaving policy."
A six-day walk from Wollemi to the Gardens of Stone will also be created, with the NSW government billing it as "one of the world's great long-distance walks".
There are also plans for mountain biking trails, rock climbing facilities and a 4WD circuit.
Deputy Premier Paul Toole said the attractions were expected to bring an additional 200,000 visitors to the region each year, and create around 200 jobs for Lithgow and the region.
"We've seen the Temple Of Doom, we've seen The Lost City this is Indiana Jones stuff, this is stuff that you just don't dream about but we're creating an experience right here in the Lithgow area," Mr Toole said.
"We talk about transitioning and diversifying the Lithgow economy, this is a step in the right direction."
Conservationists have campaigned for decades to have the land declared a protected zone.
The area has threatened elevated swamps, box woodland and tableland grassy forest, as well as a number of important Aboriginal artefacts and cultural sites.
It is also home to several rare and threatened species, including koalas, spotted-tailed quolls, regent honeyeaters and the Blue Mountains water skink.
Keith Muir from the Colong Foundation for Wilderness, who has been involved in the campaign for 30 years, welcomed the announcement.
"The new reserve ranks in the top 20 of most floristically diverse of all state forests, national parks and reserves in NSW, just behind Ku-ring-gai Chase National Park, but outranks them all on geodiversity," Mr Muir said.
"The untapped tourism value of Lithgow's Gardens of Stone backyard lies in the diversity and rarity of its scenery and native flora, and in its Aboriginal cultural heritage. These values will be protected and enjoyed by thousands of people."
The existing Gardens of Stone National Park and Wollemi National Park will both be expanded.
"This new set of reserves will rival the Three Sisters in Katoomba as the destination for visitors and tourists to the mountains west of Sydney," Treasurer and Environment Minister Matt Kean said.
"It will also provide a much-needed lasting legacy for the environment, protecting and providing habitat for numerous threatened and endangered species for future generations."
The NSW government said the changes would not rule out "responsible applications" to extend the life of underground coal mines in the areas, such as Angus Place.
The new reserves will be created through legislation to be introduced to the NSW Parliament later this month.