Toys 'R' Us Australia has gone into voluntary administration months after the US and British retail giant's collapse.

Directors of the company resolved to appoint voluntary administrators McGrathNicol after the withdrawal of the final bidder for the sale of the Australian business, a McGrathNicol spokesman said in a statement on Monday.

All Toys R Us and Babies 'R' Us stores will remain open and continue to trade while the administrators explore options for the sale of the stand-alone Australian business or a recapitalisation through the voluntary administration process.

The stores will stay open.

The company operates 44 retail stores across Australia and employs about 700 permanent staff.