Some residents have disputed receiving the letter and questioned how well the asbestos removal was being managed.

The agency has also assured residents ''all appropriate safety measures'' have been taken while asbestos-contaminated material is being removed from the site on Constitution Avenue, known as Section 5, Campbell.

Agency chief executive officer David Dawes said on Thursday a letter was sent to nearby residents in September telling them development works, including the remediation of asbestos-contaminated soil, would commence ''shortly''.

A spokesman said material started to be removed from the site on Thursday morning but ''over the last few week, contaminated material was consolidated into six piles in preparation for it to be moved off site''.

Mr Dawes said in preparation for the construction industry Christmas shutdown, the contractors were removing the mounds of contaminated soil to ensure that none remained on site while further work was suspended.

''While it is understandable that residents are concerned, I can assure everyone that the work being undertaken is in accordance with the remedial action plan endorsed by the Environmental Protection Authority,'' Mr Dawes said.

''As is always the case with work like this, an environmental consultant is on site and the air is continually monitored. To date, all air monitoring has been clear.''

The Canberra Times reported in December 2011 that asbestos had been found at the site, which was an unofficial dump for building waste in the 1950s. The land agency has earmarked the block for 520 dwellings and 8000 square metres of commercial space in a $250 million development.

Mr Dawes said Campbell residents had received seven newsletters or letters updating them on the project in the past couple of years.

''Next week, residents will receive another letter advising them about the site being shut down over Christmas and the agency website will be updated with the works program,'' he said.

But resident Mark Anderson said he did not know about the removal starting until he saw warning signs about the asbestos removal at the site on Wednesday night. Mr Anderson said that was particularly galling given that he was a community representative for the consultation.

''The LDA has absolutely failed the process of keeping people informed about what is going on,'' he said.

Mr Anderson was also ''a little cynical'' about safety procedures for the removal of the asbestos, saying the mounds of material were being disturbed by the wind and there was no evidence of dust suppression.

''It doesn't look well-watered,'' he said.

He also said workers were being protected with masks and overalls close to public walkways.

Another Campbell resident, who did not want to be named, said she noticed material being moved on site ''a couple of weeks ago'' and workers in masks, but there was no official notification of the work.

''If they did send a letter in September, I don't have any recollection at all,'' she said.

''We've had no starting dates at all. We've known asbestos is there, but I did hope they would give us some notification that work had started so we didn't go that way.''

Mr Anderson also questioned why trucks had been allowed access to Creswell Street when that appeared not to be part of the works approval.

He has been told by the land agency that the access was approved by the National Capital Authority and RoadsACT.