A strong smell of gas hung in the air in the CBD as police sealed off the area and warned shoppers to stay away.

Police and fire crews were called to the Market Street site shortly after 1pm to help stop the leak and secure the area.

Fire and Rescue NSW duty commander Inspector Don Pescud said the leak occurred when a backhoe struck a medium-pressure gas line.

A firefighter donned a gas mask to hose down the site with water for several minutes.

‘‘We know natural gas is going to go up in the air, so we water spray over it to eliminate the ignition source,’’ Insp Pescud said.

A worker from gas company Jemena, wearing a protective suit and mask, soon joined the fire crews to stop the gas escaping.

Insp Pescud said they had to force open an old steel pipe to access and clamp the gas line. The leak was stopped about 2pm.

An exclusion zone was set up on Market Street between Regent Street and Market Square while the operation was underway.

 Fire crews from Wollongong and Warrawong, the Shellharbour HAZMAT unit, Wollongong police and NSW Ambulance attended the scene.

Insp Pescud estimated about 150 people were evacuated from nearby buildings, including restaurants, offices and the Hotel Illawarra.

People gathered at the western end of Market Street, and were allowed back in their buildings about 2.20pm.

Workers said they had smelt a ‘‘strong odour’’ of gas in the air before being told to evacuate.

No-one was injured during the incident.

GPT development manager Steve Turner said all necessary precautions were taken to ensure the safety of workers and bystanders.

The gas authority will now repair the pipe.