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For the first time in more than 100 years, a Newtown bar has been granted regulatory approval to trade until 4am, seven days of the week.

City of Sydney Council accepted the proposal by hospitality group Odd Culture Group on Monday in what chief executive officer James Thorpe described as a "defining moment in the push for Sydney's 24-hour economy".

The approval was granted for a 400 square metre, cocktail-forward, live music basement bar situated within Newtown's Late Night Management Zone on King Street.

"This is a huge deal," Thorpe says.

"It's the first time in all of recorded history of this 4am licence being granted to a bar in Newtown, at least that we can find."

"It's the first time in all of recorded history of this 4am licence being granted to a bar in Newtown."

NSW's 24-hour economy commissioner Michael Rodrigues says the bar's opening would become "another sign of the revitalisation of Sydney's nightlife".

"A major part of the 24 Hour Economy Strategy is to encourage the diversification of activities and amenities at night, so today's announcement is very exciting," he says.

"It's great to see new venues opening that offer increased choice and flexibility for people when enjoying a night out."

The 24 Hour Economy Strategy was published in September 2020 and aimed at reviving the city's night-time offerings to create jobs and expand nighttime productivity.

While Thorpe remains tight-lipped on the details of the new bar, he says it will offer an alternative to the sparse-pickings of dance floors and gaming rooms open after 1am in the inner west.

"We're trying to create a different offering, somewhere you can sink into a spot at the bar with a stiff drink and have a good conversation," he says.

Thorpe says the hospitality group (who also operate The Duke of Enmore, Odd Culture, The Old Fitzroy Hotel and The Oxford Tavern) couldn't believe their luck when they stumbled across the venue site in February.

"It was this diamond in the rough," he says.

"We'd been looking for a basement space in Newtown for a really long time because it offers perfect sound attenuation and lowers the risk of getting noise complaints from residents, but there aren't many in this area."

Upon further research, Thorpe discovered the property was one of just a couple of buildings positioned within the council's Late Night Management Zone: a "sliver of an area" bordered by Erskineville Road and Newman Street, where licensing is available until 4am.

Thorpe says the application process has become easier since the onset of the pandemic.

"COVID kind of changed the way the general public, but also the government, viewed the hospitality industry," he says.

"Now they're trying to find ways to support us … The government waives the fees and the processes so you can apply online and it gets approved by email.

"It shows the planning and regulatory environment has changed. There is momentum and I think it bodes really well for the future of Sydney's nightlife."

Odd Culture Group's new late night trading bar is expected to open "before June next year".