Yarrawonga Health made the decision to cancel services after January 2020 stating "increasing challenges in recruiting" as the main reason.

"The safety of mothers and their babies, and the provision of safe and quality care always has to come first for our health service," said Yarrawonga Health chief executive Elaine Mallows said.

"This decision was made due to increasing challenges in recruiting the skilled workforce required to support birthing at Yarrawonga Health."

In 2018-19 there were only 26 babies born at Yarrawonga Health, with women classified as low risk able to be supported in the birthing suite.

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"Yarrawonga Health will still be providing antenatal care, before transferring to North East Health Wangaratta to birth," Ms Mallows said.

"Women will be given the opportunity to return back to Yarrawonga Health shortly after birth for postnatal care services with our dedicated team of midwives.

"We still recognise the importance of access to local pregnancy care and the role we play in our community to support new parents, so all our antenatal classes, clinics, postnatal care, domiciliary services will remain in place."

All planned births will go ahead and booked women have been contacted.

A statement said the board and senior executive team are "very disappointed" not to be able to provide the service to allow local families to birth close to home.

"And would like to thank our dedicated staff including our GP obstetricians and midwives for the high-quality service they will undoubtedly continue to deliver in non-birthing maternity care," the statement said.