The 37-year-old man was walking along Harrington Street in The Rocks shortly before midnight during wild weather, when a gas bottle “became airborne and struck the man causing severe injuries.”
He was taken inside a nearby hotel by witnesses where his condition deteriorated, police said.
The man was given CPR at the scene and rushed to St Vincent’s Hospital but was unable to recover from his injuries.
A crime scene has been established on Harrington Street and investigators are now seeking information from the public to assist with the inquiry.
Anyone with mobile phone vision or information about the event is being told to contact detectives at Day Street Police Station or Crime Stoppers on 1800 333 000.
It comes as NSW is bracing for further storms, particularly through the Southern Highlands and Illawarra region.