Up to 40 people could lose their jobs under the amalgamation of NSW's popular Centennial Parklands and the Royal Botanic Gardens.
Critics fear the changes will also result in the increased commercialisation of the public spaces.
Environment Minister Robyn Parker announced the plan on Monday, saying the move will create $7 million in savings that will be spent on projects at the parks.
"Efficiencies will come from the sharing of resources, staff and equipment across the Sydney basin and the amalgamation of the executive teams," she said in a statement, which contained no reference to job losses.
An estimated 30 to 40 people are expected to lose their jobs under the reforms, which will be introduced during the next 18 months, Ms Parker's office later confirmed.
The changes affect Centennial Parklands and Moore Park in Sydney's east, the city's Royal Botanic Gardens, The Domain, the Australian Botanic Garden at Mt Annan and the Blue Mountains Botanic Garden in Mount Tomah.
The Centennial Parklands and Moore Park Trust and the Royal Botanic Gardens and Domain Trust will be retained.
However, a new executive director, who will report to the board of each trust, will be hired to manage the amalgamation.
Centennial Parklands chief executive Kim Ellis said the merger would probably see buildings in the Botanic Gardens adapted for restaurants, cafes and events.
However, he told Fairfax newspapers "there isn't an intent to hold rock concerts, to sell bits of it off, to put tents up".
But Greens MP Dr Mehreen Faruqi said the move was accelerating the commercialisation of the state's parks.
"Parks should not be put in a position where they have to cut jobs or rent out public space to pay for infrastructure. The government should be properly funding these important public spaces," she said in a statement.
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