An internal fight is brewing in the NSW Government over reports a proposed southwest Sydney "mega-prison" will be built at Wollondilly.
Local Liberal MP Jai Rowell says he was woken by angry locals at 5am on Friday following reports a new jail housing up to 5000 inmates would be built in his shire.
"I can only assume and hope it's a rumour. It's such a dumb idea," Mr Rowell told AAP.
To tackle the bulging prison population the state government is planning to shut down Sydney's Long Bay jail, which sits on prime real estate in Sydney's eastern beaches, once a vast new jail is built.
But Minister for Corrections David Elliott has refused to comment on reports three sites for the 5000-inmate prison have been identified in the Wollondilly area.
"The government has not made a decision on the size of the new prison," his spokeswoman told AAP.
Mr Rowell told AAP he hadn't been notified by his party of any plans and would fight hard if the reports were true.
"I'll not allow Wollondilly to be the dumping ground for Sydney's criminals," he said.
"We need money for basic, essential services like a second high school, not a prison."
NSW Bureau of Crime Statistics and Research director Don Weatherburn says inmate numbers have reached a record high over the past two years and are showing no signs of slowing.
"The way we're going the prison population is climbing faster than it is possible to build new prisons - at some point, something's going to give," Dr Weatherburn told AAP in February.
Labor says the state's prisoner population has jumped to 12,611 and continues to grow.
Opposition Leader Luke Foley said on Friday it would cost at least $1 billion to "plonk" the mega-prison in Sydney's expanding region.
"I thought the residential growth area in southwest Sydney was about growing families, not a growing place for crims," he told reporters outside NSW Parliament on Friday.
Mr Foley blamed the current overcrowding crisis on the government's closure of prisons in 2011.
The decision, he said, cost regional jobs for areas that had relied on the prisons' operations.
"In many parts of the state, residents don't want to live cheek by jowl with a jail. Grafton's the exception," he said.
Mr Foley said he didn't have the information, privy only to the government, to decide if and where Labor would re-open a prison.
Labor's corrections spokesman Guy Zangari proposed "temporary modular accommodation" as a short-term strategy to ease the overcrowding crisis.
"The system needs beds today, tomorrow and next week," he told AAP on Friday.
He also criticised the privatisation of prisons and accused the government of insulting the state's prison officers.
"With private prisons there's no process for being open and transparent," he told AAP.
