A 60,000-plot cemetery at Greendale was approved last Thursday, but community opposition has not yet been buried.
The Sydney West Joint Regional Planning Panel approved the cemetery at 321 Greendale Road, despite Liverpool Council recommending it be rejected.
It will be the second biggest cemetery in the Liverpool local government area, sitting on about 40 hectares.
Leppington's Forest Lawn Memorial Cemetery is the biggest, on just over 57 hectares.
The original development application was lodged more than two years ago and a decision was deferred twice.
Greendale resident Duncan McDonald says the community is not happy and they will continue to fight.
"The JRPP have ignored evidence that water contamination is a real threat to agriculture," Mr McDonald said.
"They have ignored the risks associated with the road network."
He said the panel referred to a revised soil testing report that "apparently the applicant submitted, [but] which was not made available to the objectors".
"The premier has been advised of the community outrage."
The area of the site to be used for burials is just over 13 hectares and the Liverpool development control plan requires a burial site to be at least 15 hectares.
An assessment report submitted by Liverpool Council said both it and the panel had previously refused other applications for cemeteries on Greendale Road for non-compliance with this control.
The council also mentioned it recently set about prohibiting cemeteries and crematoriums in its rural zones.
There were 216 submissions on the first exhibition of the DA.
Two Liverpool councillors — Nadia Napoletano and Tony Hadchiti — are on the panel and both voted against the development.
Cr Hadchiti said he was disappointed and worried about the precedent it would create.
"The residents had legitimate concerns that were ignored," he said.
"We know Greendale Road is a shocker, it's a death road that needs an upgrade."