Sydney land previously marked for a new housing development will instead now become a National Park, after koalas were discovered living in trees in the area.
"Today is about one thing and one thing only and that is that we need to get on and save koalas in the wild," new Environment Minister Penny Sharpe told reporters from Wedderburn in the city's southwest on Saturday.
"They're on track to be extinct by 2050. We've got a 28-year window to turn this around."
One week on from the NSW election, Ms Sharpe has directed the National Parks and Wildlife Service to take control of nearby land owned by Sydney Water, at Woronora Heights near Heathcote, and turn it into a protected corridor.
While the tract is relatively small, a new population of koalas has been discovered there and protecting the population was vital, Mr Sharpe stressed.
"This is extremely important.
"Sydney Water was planning to put housing into this very important corridor where there are koalas and then they were going to flog it off.
"This is also about not privatising public land."
It comes after NSW Labor campaigned strongly against the sale of public assets in the lead up to last week's state election, forcing former premier Dominic Perrottet to rule out future privatisation mid campaign.
On election night, Premier Chris Minns called Labor's victory a "decisive vote against privatisation".
Koalas were listed as an endangered species in NSW last year and a NSW parliamentary report found the marsupials were on track for extinction before 2050 unless the government intervened to stop habitat loss and other threats.
Ms Sharpe was joined by koala conservationist Ricardo Lonza, founder of Help Save the Wildlife and Bushlands in Campbelltown, who said preserving koala corridors was key to the endangered species' survival.
The group also appeared with baby koala Teddy, who was orphaned after his mother suffered a fatal leg injury and is set to be released in the Heathcote area after eight months in care with Sydney Wildlife
"It's important that we save koala habitat, and koalas into the future, so koalas like Teddy can live on," Mr Lonza said.
Australian Associated Press