The funds to fix a Princes Motorway "choke point" will allow for detailed design work, utility service investigation and property acquisition - estimated to take between 18 months and two years.

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"We know this is a disastrous area when it comes to crashes," Mr Constance said.

"It's an area which does need this work, that's why we need to get on with this.

"Once we get this work done we can come back to the community with the critical pathway in terms of time frames for starting construction and completing construction as well."

Residents around the foot of Mt Ousley will not be losing their homes as part of the interchange construction.

"The beauty with the acquisition is it's not residential," he said.

"It's largely to do with the university and just making sure that we've got the road width space available."

Mr Constance said the project would costs "hundreds of millions" of dollars, but it was too early to offer a firmer figure.

He did say it would be cheaper than the $630 million Albion Park Rail bypass.

The project will include the separation of light and heavy vehicles at the base of Mt Ousley, a new northern entrance to the University of Wollongong and a bridge over the motorway from Mt Ousley Road.

It will also see the removal of the dangerous right-hand turn out of Mt Ousley Road, long a concern of Keira MP Ryan Park.

Mr Park was pleased with the $21 million in funding.

"This project will see improved road safety and travel times," Mr Park said.

"The community has been waiting patiently for this project and this is a big win for them.

"This is a critical project on the busiest road corridor in the region and it has been a priority project for my electorate."

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