Work on the roundabout began on Monday and council has written to residents in the neighbourhood to provide them with a working timetable.

The intersection will be closed to all traffic for 14 weeks during the project, council says weather permitting.

The single lane roundabout will be funded by $650,000 from the NSW Government's Safer Roads Program, and will be built after the intersection was the scene of five traffic accidents in the last five years, with three of those resulting in injury.

While acknowledging the inconvenience, Orange mayor Reg Kidd said closing the intersection is the most efficient way of getting the job done safely.

"We've sent letters out to the neighbourhood to give them time to prepare," Cr Kidd said.

"There will be some inconvenience for people who use those streets regularly so I'm asking for their patience while we get this major improvement done.

"There will be clearly marked detour signs in place to show drivers how best to make your way around that intersection.

"There are number of businesses near that corner that will be open and trading as usual.

"We want to make it as simple as possible for customers to continue to access those businesses."

Orange City Council's Infrastructure Committee Chair Jeff Whitton said he was pleased to see the design of traffic features like roundabouts is continuing to be guided by the council's recently updated flood study.

"This intersection is right alongside the East Orange stormwater channel," Cr Whitton said.

"This roundabout will be a low-set, pancake design without a central garden. It will also be built with extra stormwater capacity to handle potential flooding."

"Building a roundabout to its usual height had the potential to push floodwater into nearby properties.

"The design of this roundabout will act like a drain in a bath, making a positive difference in the event of a flood."