An artist impression of the redevelopment on the corner of Swanston and Grattan streets.

The old Royal Women's Hospital will be demolished despite plans to save the building, the birthplace of hundreds of thousands of Victorians.

The state government has signed off on plans for a $425 million University of Melbourne expansion that will level the remaining hospital buildings as part of the university's rapid growth across the city's north.

The university had aimed to redevelop the site without knocking down the hospital, but helicopter flight path restrictions scuppered the original plan.'

The former Royal Women’s Hospital, which opened on the Swanston Street site in 1858 and grew to become Australia’s busiest birth ward, was closed down when the new hospital opened in nearby Parkville in 2008.