NSW premier Nathan Rees has accused NRL boss David Gallop of trying to bump up the price of hosting rights to the NRL grand final and warned it will backfire.

Rees went on the attack on Thursday after Queensland counterpart Anna Bligh said she was "playing hard" to secure the rugby league showpiece after the NRL's deal with the NSW government expires in 2012.

The Queensland government would reportedly be prepared to pay up to six times more than the $500,000 NSW currently gives the NRL to host the grand final.

Gallop revealed on Wednesday that the NRL had been in preliminary discussions with Queensland and said it would be mad if it didn't have an open mind about approaches to shift the grand final to Brisbane or even Melbourne.

But Rees was having none of it, declaring Sydney the game's "spiritual home" and claiming it would be "lunacy" to shift the grand final interstate.

He claimed Gallop was attempting to bump up the price NSW pays by discussing a possible move.

"I think that's precisely what he's trying to do and it will backfire," Rees said.

Rees made it clear NSW would do all in its power to retain the grand final.

"My position on this is crystal clear. If Bligh thinks that she'll have a fight, she certainly will have a fight, we'll fight to the death on this issue," Rees told Sydney's Triple M radio.

"Ultimately it would be a kick in the teeth for the people of NSW should David Gallop and the NRL decide to have a grand final anywhere but Sydney.

"This is the spiritual home of rugby league and the grand finals that we've seen here in recent years have been absolutely extraordinary.

"You've seen the community spirit that got behind the Parramatta Eels this year, regardless of whether people were Parramatta supporters or not so any notion that it should go to another state, I think is lunacy, particularly when the NRL says they are concerned about the AFL incursion into Western Sydney. It plays straight into the AFL's hands."

And while admitting he faces a battle with Queensland, any possibility of Melbourne being seriously considered as a grand final venue was dismissed by Rees, who labelled the Victorian capital a "provincial town".

"They can send it to Melbourne and have 20,000 people in a stadium down there in what is basically a large provincial town or they can have it in Sydney, the gateway to Australia," Rees said.

"I think this is absolute lunacy by the NRL and it's a kick in the teeth for all the people in NSW who have supported rugby league over the last century.

"Any notion that the rugby league grand final leaves its home of NSW, I think is just a recipe for disaster for the NRL, they ought to come to their senses and come to their senses quickly."

Asked if NSW would consider making a bid to host the AFL's grand final in the future, Rees said: "Not today, but I'm happy to give it some consideration."

Bligh on Thursday told the Queensland parliament the state's passion for the game would mean the NRL would be "crazy" not to give the grand final to Brisbane.

"Not only do our teams have the backing of long-term Queenslanders, but as 1,000 people move to Queensland every week - the majority from NSW and Victoria - fans of southern states are also hankering to have a final here in the north," said Bligh.

"Queensland has now emerged as the passion state when it comes to the great game of rugby league ... the National Rugby League ... would be crazy to miss the opportunity to showcase their event right here in Queensland."

Gallop concedes NSW won't let the game go without a fight.

"I'm comfortable that the NSW government recognise the value of the grand final and I don't think they'd be letting it walk out of Sydney without putting up a good argument to keep it here," he said.

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