According to The Sydney Morning Herald newspaper, the accident took place at 10:00 a.m. local time (23:00 GMT), when the train hit a buffer stop at the end of the rail line at Richmond station.
East Market Street is now closed between March and Windsor Streets to assist emergency services. Three helicopters, 17 ambulance crews, and fire and rescue teams were deployed to escort passengers off the train.
"Sydney Trains is aware of an incident involving one of our trains hitting a buffer at Richmond Station".
Train services have been suspended between Richmond and Clarendon in both directions.
LIVE STREAM: A train has overshot the platform at Richmond Station and crashed into a barricade.
A total of 16 people were injured in the crash, NSW Ambulance said. "(It) crashed at full speed into the barrier sending everyone flying like superman!" he wrote on Facebook, adding it was insane.
Paramedics treated 15 people following the accident.
Officials said it is too soon to determine the cause of the crash. "Management came to the meeting with an offer but it was not up to scratch", it said on Monday night's meeting. "There was a huge amount of dust", he said. "We will provide more information as it becomes available", it tweeted.
Sixteen passengers were injured in the incident, police said.
A Sydney Trains spokesperson said they are "aware" of the incident.
"No customers or staff are trapped", the operator said on Twitter.
The other patients suffered back and neck pain, cuts and bruising after being flung around the carriages on impact.