Construction will begin on Sydney’s WestConnex within months after the NSW government approved the motorway plan.
The 5.5km tunnel will run between Homebush and Haberfield and is intended to reduce congestion on Parramatta Road, the NSW Department of Planning says.
"I don't want motorists to lose any more time sitting in the car park that is Parramatta Road, and WestConnex will be crucial in fixing the problem," NSW Minister for Roads Duncan Gay said on Friday.
Sydney City lord mayor Clover Moore is angry about the project's approval.
"Appalled to see another stage of #WestConnex (M4 East toll road) approved. A disaster for our city east and west," she tweeted.
NSW Minister for Planning Rob Stokes said the project had been approved only after issues raised by the community - especially pollution - were addressed.
He said the air quality around the tunnel would be closely monitored.