After five days of intense speculation about his intentions, Labor MP Luke Foley has announced he will run for the party leadership in NSW following John Robertson's sudden resignation last week.

Mr Foley, 44, an upper house MP, said he would not accept a "parachute" into the lower seat of Auburn, but would stand for rank and file preselection.

He said the sitting member for Auburn, Barbara Perry, who has been locked in a preselection battle with Auburn councillor Hicham Zraika, was a close friend and had encouraged him many times to run for the seat. However, Ms Perry has indicated that at this stage, she will not withdraw from the contest.

"I have not withdrawn my name from the Auburn preselection and I have no intention whatsoever of withdrawing the serious charges [of branch stacking against Cr Zraika] placed before the Review Tribunal," Ms Perry said.

It is understood the ALP national executive is likely to use its plenary powers to cancel the current Auburn preselection and order a new, expedited rank and file ballot.

If he is elected leader at the January 5 caucus meeting, Mr Foley would then stand for preselection as Labor's candidate in Auburn.

Under a plan taking shape, Cr Zraika, would not contest the ballot in favour of securing a winnable spot on the ALP the upper house ticket and his numbers would be expected to shift to Mr Foley.

Mr Foley, who lives 600 metres outside the Auburn electorate boundary in West Concord, told reporters: "This is my community. I live just down road, my kids swim here".

Two other leadership contenders, upper house MP Steve Whan, 50, and Maroubra MP Michael Daley, said on Sunday they remained in the leadership contest.

Mr Daley, 49, a former minister and MP of nine years, said he had a solid grounding outside of politics, having worked as a customs officer before putting himself through law school at night before becoming a corporate lawyer.

"I'm not a person who has come through the party machine," he said.

"I went into public life to represent the people of the suburbs ... the mums and dads who desperately rely on the services not being provided by Mike Baird".

Deputy leader Linda Burney ruled herself out of the leadership contest on Sunday.

Mr Whan said he was putting himself forward as a "fresh face to the leadership in NSW" from outside of Sydney.

Mr Foley, who is favoured to win by party head office, said if elected leader he would bring energy, ideas and "timeless Labor values" to the leadership.

He invoked the example set by former leaders Bob Carr, Neville Wran, William McKell, saying his intention was to return the party to the mainstream.

"Those values will be applied under my leadership to modern circumstances," he said.

"A Labor Party led by me will be a party of solutions, and never a mere party of protest," Mr Foley said.

Mr Foley said he would promote economic development to generate jobs and prosperity, while promoting the protection of the environment and public assets. He will maintain opposition to the Baird government's proposed sale of the electricity network "poles and wires".

Caucus will decide on January 5 who will take on the leadership, following Mr Robertson's resignation last week over revelations he had signed a letter of request for Lindt cafe gunman Man Haron Monis in 2011 as his local MP.

Mr Foley admitted it had been a difficult decision running for the Labor leadership because his three children were young and his Irish-born wife lived a long way from her family.

"The kids are very young and I need to be around to be a decent dad, my wife is from the other side of the world," he said.

However, he had realised it was now or never for his run for the leadership.

"You don't choose the timing, the timing chooses you," he said.

"This is the one chance I get to lead the Labor Party."

Fairfax Media understands that Ms Perry and Mr Foley had originally discussed a succession plan for the seat of Auburn that would take effect well after the 2015 election and that Mr Foley rejected the plan for family reasons.

Mr Foley said he was the first member of his family to go to university, thanks to the tertiary education policies of Gough Whitlam. He worked as telemarketer to put himself through a Bachelor of Arts degree at the University of Sydney, majoring in politics and industrial relations. During that time, he was a vice president of Young Labor.

He has worked for the Australian Services Union and served on the NSW Labor Party's administrative committee for 15 years. He was assistant secretary for the party for seven years.

Asked about his leadership prospects beyond 2019, Mr Foley said he had "no guarantees".

He said he had spent the last five days with his family discussing the leadership opportunity.

"My wonderful wife and gorgeous three kids want me to do this job. I will now go forward and speak to my caucus colleagues.

"I put myself forward over the coming week before tomorrow week's caucus ballot.

"I put forward my ideas, my energy, my Labor values. I want a modern Labor party rooted in its timeless Labor values, applying those values to modern circumstances.

"I respect all my Labor parliamentary colleagues. I'll spend the next few days talking to them."

Mr Foley said he had told party secretary Jamie Clements that he does not want to be parachuted into the seat of Auburn.

"That would be inconsistent with what I have stood for in my political life. I want a rank and file selection ballot in the seat of Auburn," Mr Foley said.

"I put myself before my parliamentary colleagues for the position of leader. I put myself before the party members of Auburn to be their candidate.

"That is what I want and what I expect to happen in the weeks ahead."

If he is successful, Mr Foley will leave a vacancy as the ALP leader of the upper house.

Asked if he was interested in seeking that job, upper house MP Walt Secord, who was with Mr Foley at his press conference on Sunday, said it had not crossed his mind.

"There is only one vacancy we need to fill today," Mr Secord said.