Advocates including MPs from the fledgling Legalise Cannabis party have long argued individuals who drive after using the medicine and are not impaired should be allowed on the roads.
While Victoria is researching the impact of cannabis on driving, it and other mainland states do not treat medicinal cannabis like other medicines in drivers' systems.
However, NSW on Thursday said it was working on an exemption for drivers as Premier Chris Minns described current rules as not fit-for-purpose.
Legalise Cannabis MP Jeremy Buckingham is one of three MPs with bills before the parliament that would provide an exemption for cannabis-using drivers.
"The status quo is broken and is discriminating unnecessarily against hundreds of thousands of people in NSW," Mr Buckingham told AAP.
"It's time medicinal cannabis was treated like every other type of medicine."
Around 400,000 people across NSW access medicinal cannabis via prescription, Mr Minns told a budget estimates hearing.
"Hundreds of thousands of people are accessing it as a legitimate health alternative to even more powerful drugs," he said on Thursday.
"We need a fit-for-purpose regime on NSW roads so we're not disenfranchising people.
"We will draft our own legislation, but we're actively considering a change in the policy."
But much debate will surround how authorities test if a driver on medicinal cannabis is impaired or not.
A roadside drug test detects the presence of tetrahydrocannabinol or THC - the main compound in cannabis - but does not gauge how much remains in one's system.
Traces of cannabis can remain in someone's system for weeks, while Mr Buckingham said doctors typically advise users to not get behind the wheel for six hours after consuming.
"We certainly don't think anyone should be on the road if they're impaired and as with any medication, ultimately that comes down to people according with their prescribing doctor's advice," he said.
The premier indicated he had an idea in mind for testing if someone was fit to drive, but did not divulge it as the government's proposed legislation has not gone to parliament.
Independent MP Alex Greenwich, who is prescribed medicinal cannabis for anxiety and insomnia treatment, felt relieved by the call.
But the NRMA maintained its opposition, citing road safety fears.
"The concern is, how do you police it? How do you measure impairment? That's the challenge that still hasn't been addressed," spokesman Peter Khoury told AAP.
Victoria is running a world-first trial to evaluate the effects of THC-prescribed medicinal cannabis on the driving performance of patients within a controlled-track environment.
Since March 2025, Victorian motorists who have medical cannabis in their system but are not impaired by the drug have not faced automatic driving bans.
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