A relieved Coalition Against PFAS president Lindsay Clout summed up the feelings of many of those residents impacted by the contamination when he declared the mediation agreement reached between lawyers for the class action and the federal government had been "a victory for the people".

"All we ever wanted was what Defence took away from us and [Wednesday night's] decision was a big step forward in achieving that. This has been a big, protracted fight which has taken its toll on the entire community," Mr Clout, from Fullerton Cove, said.

"My only hope is that this announcement will provide some comfort to this community and those residents who have suffered throughout this long process."

In a joint statement from Defence Minister Linda Reynolds and Defence Personnel Minister Darren Chester last Wednesday night, the government announced it had reached an in-principle agreement to settle three Federal Court of Australia class actions relating to PFAS contamination in the communities of Williamtown, Oakey (Queensland), and Katherine (Northern Territory).

"The parties are in the process of finalising detailed terms of the settlement. These terms are confidential and are subject to formal consideration and approval by the Federal Court," the statement read.

"Reaching a settlement is not the end of Defence's engagement in these communities, however, it does represent an important milestone on what has been a difficult journey for many people over the past few years."

The class action, set down to be heard in the Federal Court of Australia from April 1, has now been avoided.

The in-principle agreement came after two days of intense mediation talks, on February 25 and 26, between the Department of Defence and lawyers representing the communities.

Ben Allen, from Dentons Lawyers leading the Williamtown class action, described the comments from the government as "encouraging".

"They show that the government will now take their responsibilities seriously and are committed to engaging with those impacted by PFAS contamination," he said.

"It is also a total vindication for the residents of Williamtown and its surrounding communities who have made their voices heard and refused to remain silent.

"This was a complex legal matter but not only did the community spend significant time understanding the issues, they have, as acknowledged by the Senate, become national experts in the dangers and risks of PFAS."

Linden Drysdale, a longtime resident of Cabbage Tree Road at Williamtown, said that many of the neighbours she had spoken with had expressed similar relief, but were mindful of what lay ahead in terms of detail.

"This is a start but it has now become a waiting game. We want to know the details: will we be compensated, will there be offers of buy-backs? Residents have been living this nightmare for five years so any news of a breakthrough is welcomed but we won't be popping any champagne corks just yet," she said.

The Port's federal and state Labor MPs, Meryl Swanson and Kate Washington, said they were delighted with news that the mediation for the PFAS class action had been successfully negotiated.

"At first, I didn't believe it. Then I got a phone call from Lindsay and Anne Clout to say 'Meryl, we won'. The Williamtown, Fullerton Cove and Salt Ash communities have consistently shown courage, tenacity and determination throughout this gruelling process," Ms Swanson said.

"The next step is to ensure this matter resolved speedily so my community can move on with their lives like they so deserve to do. I note the statement by Ministers Reynolds and Chester that this is not the end of engagement with the community."

Ms Washington said that the settlement would allow the Port's heartbroken families to get on with their lives.

"I am in awe of the strength and determination shown by this community in the face of unimaginable cruelty and obfuscation from their own government," she said.

"These local families never gave up. I'm hopeful this settlement will deliver what families affected by PFAS have lost for too long - a sense of hope."