More development will occur in established parts of Melbourne as the city swells to almost 8 million people by 2051.



There will be five metropolitan subregions, with the southern and northern areas to absorb the biggest growth.



People should be able to reach services and facilities within a 20-minute time limit, the Plan Melbourne blueprint foresees.

The plan guides growth to 2050, when the city's population is forecast to hit 7.7m, adding 3.4m to the current figure.

Launching the plan on Monday, Victorian premier Denis Napthine said 1.7m new jobs and 1.6m more dwellings would be needed to accommodate the changing population.



But the blueprint says suburbs would be protected, with development to occur in defined areas near services and transport.



Melbourne will be divided into five metropolitan areas: central, western, northern, southern and eastern.



The blueprint outlines a framework for key infrastructure to support the city as it grows.



Napthine said these included the East West Link road project, the Melbourne rail link, including a line to Melbourne Airport, widening the Tullamarine freeway, expanding the port and upgrading the Cranbourne/Pakenham rail line.



In future, Melbourne will have a permanent urban boundary and be a more contained metropolis, allowing more development in established areas.



Napthine said the state was growing at a rate of 2% a year, compared with the national average of 1.8%, and future growth could be achieved while protecting the quality of life in Melbourne.



"We believe that we are a strong economy, we are a vibrant economy, we are an economy with significant room for growth in Melbourne," he told reporters on Monday.



Planning minister Matthew Guy said Melbourne could grow sustainably, but it had to be in targeted areas.



The plan identifies at least a 30-year supply of urban-zoned land on the metropolitan fringe. But it says it is no longer sustainable to continue expanding outer growth areas.

Instead, more housing should be developed in established metropolitan areas.