The proposal, put forward by Destination Wollongong, aims to revitalise the under-utilised mountain and encourage people to visit the region by capitalising on growing interest in adventure tourism.

Stretching from the summit to Stuart Park, the cable car would give tourists panoramic views and provide transportation to the other proposed attractions on the mountain peak.

Estimates put the cost of an eight-person gondola linking the summit to Stuart Park at $15 million.

Included in the Mount Keira Adventure Playground overview are a zip line, rock climbing, bungee jumping, native bird sanctuary, tree top adventure park, eco lodge, mountain bike trails, cafe and function centre.

It will incorporate existing attractions such as the rhododendron gardens at Mount Pleasant.

It's not the first time a cable car has been suggested for the Illawarra - it was last floated in 2010 when an Illawarra businessman investigated building one from his property to the Wombarra escarpment.

Destination Wollongong general manager Mark Sleigh said developing Mount Keira would have the double benefit of boosting tourism and providing jobs for the region.

"The gondola project would be an anchor for the whole thing but it doesn't work by itself; the cafe doesn't work by itself; the bungee jump doesn't work by itself - what it needs is a range of like-minded businesses that complement each other so everyone from the grandmothers to the babies have something to do."

He said the development would rely on private investment.

A spokesman for the Save Mount Keira Lookout Action Group, Leigh Stewart said the adventure precinct would put the region on par with other cities around Australia and draw visitors to the Illawarra instead of the Blue Mountains or Hunter Valley.

"Realistically, we need to stand up because if we don't we're going to find all these other regions around Australia are leaving us behind."

He said co-operation between authorities, including council and state government, was needed for the project to succeed.

Mr Sleigh said a more detailed study would now be conducted.