NSW Transport Minister Gladys Berejiklian has conceded there will be disruptions in Sydney's CBD when George Street is dug up to build two light rail lines.

The lines linking Sydney's Circular Quay to Central Station then on to Randwick will be built at the same time rather than in two stages, she confirmed on Thursday.

The eastern suburbs line to the Sydney Cricket Ground, University of NSW, Randwick Racecourse and Prince of Wales Hospital was initially tipped to be built before the more contentious CBD line.

But Ms Berejiklian said the lines were now being treated as one project, although they will be built in stages to minimise disruption.

The $1.6 billion line aims to reduce congestion in the city and give people a faster ride along George Street than buses.

The stretch of George Street between Bathurst and Hunter Streets - about 40 per cent of the major artery - will be closed to general traffic and opened to pedestrians.

Ms Berejiklian told Macquarie Radio the aim was to make sure people could use the whole line once it was completed.

"If you decided just to do George Street first you'd have thousands of people descending on Central and then having to move them.

"Similarly if you did the eastern bit first you'd have thousands of people at Central and not able to move them quickly enough down through George Street and other parts of the CBD."

The minister said detailed modelling was underway to determine how to build the line as quickly as possible with minimal disruption.

"There will be disruptions, I won't deny that, but we're convinced that by planning it properly we can minimise that."

She said work would get underway in 2014 and she hoped it would be up and running within five or six years from then.