Prime Minister Scott Morrison has supported state MP Melanie Gibbons' decision to leave State Parliament and seek Liberal Party preselection for the seat of Hughes to take on Craig Kelly.
"Melanie is a passionate state Liberal member and has served her community for nearly two decades," Mr Morrison said in a statement.
"Her experience and perspective would be a welcome addition to my federal team and working together in neighbouring electorates in southern Sydney".
Announcing her intention to resign as the MP for Holsworthy, Ms Gibbons said, "I love my community - but for some time it has been let down by Craig Kelly. It needs and deserves better representation".
"Looking forward, the seat of Hughes needs someone ethical, who listens and responds to them; someone who can serve them and give them a strong voice within a Liberal Government," she said.
The state seat of Holsworthy and the federal seat of Hughes both extend from the west of Sutherland Shire to the Liverpool area and cover a lot of the same territory.
Liberal preselection nominations haven't been called yet and no other candidate has so far emerged.
NSW Labor deputy leader Prue Car blasted the move, saying, "The Premier needs to demand Melanie Gibbons reverse her decision and stay on to support the people of Holsworthy as we emerge from lockdowns, rather than jump ship to look for a new job in Canberra".
"The midst of a pandemic is not the time for ministers and MPs to cut and run. Some 6000 people lost their jobs at the peak of the current lockdowns in the electorate of Holsworthy.
"A by-election in Holsworthy would cost over $1.2 million of taxpayers' money".
However, last weekend, former Labor leader Jodi McKay announced she, too, would be resigning from State Parliament, saying in a statement, "The lockdown has given me time to reflect and consider my future".
Ms Gibbons told the Leader she was "not cutting and running".
"I am continuing to serve the same community in a different way," she said. "It's still the same care, compassion and effort but in a different role."
Ms Gibbons' partner Kent Johns, a shire councillor, has twice previously been in a position to win Liberal preselection for Hughes until intervention by Prime Ministers Malcolm Turnbull and Scott Morrison. He said in a March 2021 media interview he no longer wanted the seat.