NSW Education Minister John Della Bosca says the government is committed to providing choice when it comes to schools of different religious denominations.
His comments come after Camden Council, in Sydney's south-west, on Tuesday night refused planning permission for a 1,200-student Islamic school, following an adverse report by council planners.
Mayor Chris Patterson says the decision was based on concerns surrounding the impact on traffic flows, loss of agricultural land, and not on religious grounds.
Mr Della Bosca said he was not in a position to comment about the council's decision because he had not examined the planning issues involved.
"From an education perspective, of course educational choice is part of the policy consensus between state and commonwealth governments and across the policy divide," he told reporters.
"Clearly, that is something that is supported by all governments.
"There is a number of Islamic based schools operating in NSW at the moment, they do so teaching the NSW curriculum, doing all the things that a school is required to do."
The planning matters were an issue for local councils, Mr Della Bosca said.