Along with providing a safer journey for cyclists and pedestrians between the twin towns, the cycleway will form part of the Hunter Anzac Memorial, which will pay tribute to the 321 men from Branxton and Greta who served in World War I.

Originally known as the Branxton-Greta Memorial Cycleway, the project began as a joint initiative between the Branxton-Greta Business Chamber and the RSL sub-branches of each town.

It changed its name and became a registered charity in 2018, and then-Governor of NSW (now Governor-General) David Hurley was appointed as its patron.

Hunter Anzac Memorial Limited chairman Brett Wild was pleased to see construction start after many years of lobbying for the project.

But he said there's more hard work ahead, with the charity to raise a further $1.5 million fund the memorial aspects of the cycleway.

Mr Wild said the long-term vision is to create a Hunter memorial trail from Newcastle through to Muswellbrook.

Cessnock City Council secured $1.95 million from the Australian Government's Building Better Regions Fund to construct the physical infrastructure of the 3.3-kilometre cycleway, and will provide a co-contribution of $650,000 towards the project.

A sod-turning ceremony was held at Branxton on Monday to signal the start of works, which are due to be completed by March next year.

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Cessnock mayor Bob Pynsent said the beginning of construction marked a "wonderful milestone" for the cycleway project.

"This project has been a shared community vision, driven by the community who have tirelessly advocated to see it become a reality," he said.

"Branxton-Greta Business Chamber and the local RSL sub-branches' hard work has certainly been rewarded.

"It will be a unique way for current generations to recognise the sacrifice of local service personnel.

"It will offer residents and visitors another opportunity to enjoy our wonderful local government area and its rural surrounds.

"No doubt for many locals it will become a regular part of their weekend for walks and rides with family and friends."

Construction will be undertaken in a number of stages, subject to ground conditions and weather.

During works there will be some unavoidable traffic disruptions.

To keep up to date with project, visit the Branxton to Greta Cycleway project page on council's website.