The rail corridor between Macarthur and Glenfield in Sydney's south west is set to be transformed into a new urban precinct that will see high rise, retail and employment areas created in some of Sydney's more run down suburbs.

The plan, unveiled by Planning Minister Rob Stokes on Sunday, outlines seven station precincts from Glenfield to Macarthur which will be revitalised with increased population density, and with more thought being given to the community and transport needs of the area.

For example, the plan, which will be released for public comment, includes cycleways and walking paths, better bus transport, upgrades to libraries and a new primary school in Campbelltown.

It signals the future direction the Baird government is likely to take on accommodating Sydney's rapidly growing population - expected to reach 5.3 million by 2030 - by focusing on areas close to existing transport. The previous Labor government had put a big emphasis on redeveloping old industrial land close to the CBD. The Baird government looks to be focusing on under-utilised areas of the city that are close to public transport corridors, with an emphasis on trying to also create local employment precincts close by.

"We know that one in every five additional Sydneysiders will be living in the south west by 2036 – so it's crucial we get the planning right," Mr Stokes said.

"The community has already responded to a survey and told us what they love about their neighbourhood and what improvements they'd like to see," he said.

"We've used this feedback to provide a road map for revitalisation which will facilitate more than 20,000 additional jobs and 15,000 new homes by 2036."

The report notes that the corridor already has an extensive network of open space and recreational facilities and sports ground and no more is required. Instead it suggests that large areas of open grassland, could provide opportunities for alternative uses and that savings could be used to improve public domains around the railway stations.

The draft corridor strategy outlines the future vision for station along the train line. Macarthur would become part of Campbelltown regional city centre with high rise close to the station, low rise retained to the east and a large business park to the west.

Macquarie Fields, on the other hand would remain a local village centre, with small scale development close to the station. Ingleburn would become a "vibrant urban village" with low rise maintained along the main street but stepping up to medium heights of four to eight storeys close to the station.

Mr Stokes said once the community provided feedback the strategy would be refined further.