A woman's body has been discovered in a state of decomposition inside a suitcase by the side of a regional New South Wales road, sparking a major police investigation.

Two men had stopped on the side of the road when they discovered the suitcase at Oallen, about 60km southeast of Goulburn, just before 1pm on Sunday.

Police attended the scene on Wolgon Rd and located a woman's body inside the suitcase.

It is unclear how long the body had been there, and the remains are yet to be formally identified.

"Unfortunately, the female remains have been subject to a state of decomposition," Superintendent Linda Bradbury told Nine's Today.

"We're conducting a number of enquiries to assist us in locating the identification of the female and also how she ended up in that location.

"We are relying a lot on forensic evidence."

The discovery was made by two men who had pulled on to the side of the road by chance, Supt Bradbury said.

"They were able to tell us how they come across it," she added.

"Unfortunately they were on a weekend drive as a lot of people do over the weekend and stopped for a break. (It was) quite a shocking discovery for them, absolutely."

Detectives have established Strike Force Bryton to investigate the incident, with assistance from the homicide squad.

Oallen in the Southern Tablelands region of NSW, is about 109km northeast of Canberra and 225km southwest of Sydney.