The legal fight to stop the NSW government from pulling down Sydney's Allianz Stadium before the state election is headed back to court.

NSW Labor leader Michael Daley wrote to NSW Premier Gladys Berejiklian on Thursday demanding “hard demolition” be halted as the coalition pushes ahead with its $730 million plan to knock down and rebuild the Moore Park venue.

Heavy machinery was seen tearing down parts of Allianz on Thursday afternoon.

The Land and Environment Court last week threw out a challenge by Local Democracy Matters and Waverley Council meaning major works could proceed.

The community group immediately filed an appeal in the NSW Court of Appeal which will be heard on Friday.

Supporters of the challenge hope wet weather, predicted for Friday and the weekend, will slow the demolition efforts until the matter is heard in court.

Labor says if it wins the March 23 election it will refurbish rather than rebuild the Moore Park stadium to save hundreds of millions of dollars.