One of two hostages who died in a Sydney cafe siege last month was killed after being hit by fragments of a police bullet.

An inquest into the into the 16 hour standoff has heard barrister and mother of 3 Katrina Dawson was hit by a ricocheting bullet, after police stomed the building.

The cafe manager was shot by the hostage taker Haron Monis who also died in the shootout.

Opening the inquest, New South Wales state coroner Michael Barnes said it will be thorough.