Tasmania would suffer immense reputational damage and "fail the next generation" if a $1.13 billion stadium doesn't get built, the state government claims.

The Liberals, who are unmoved in their support for the Macquarie Point venue, have released their response to a state planning commission report that recommended it not go ahead.

The commission said the cost of the 23,000-seat roofed venue outweighed the benefits, that it was too big for the waterfront site and would impact the heritage of the area.

The stadium, which needs to pass a vote of parliament to be approved, is a condition of Tasmania entering the AFL and AFLW in 2028.

"The opportunities this project offers Tasmanians are something we cannot and should not give up on," the government response, released on Wednesday, said.

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