A€250m private medical facility is to be built in the grounds of St James's hospital.
The new 196-bed private hospital, which has just been given the go-ahead, is expected to employ 400 people in the construction and 545 when up and running.
A 19th-century chapel on the groundsl is to be knocked down to facilitate the ambitious new project despite massive opposition.
The demolition will take place as part of the so-called co-location of private hospital in the complex.
Dublin City Council gave Synchrony Properties Ltd permission for the project, which will be located on a 1.14-hectare site in the southwestern section of the grounds.
Synchrony has a contract agreement with the Health Service Executive (HSE) to build the private hospital under the Government's co-location scheme.
It said previously the development would be built within two-and-a-half to three years of the project getting the go-ahead from planners.
The local authority had told the developer to investigate the feasibility of relocating the chapel within the site.
However, in its decision, the council approved the demolition without imposing an obligation to rebuild the historic building. One of the conditions of the permission stated: "The demolition of the chapel on site shall only be carried out on the commencement of construction works."
While it added that "stone, brick and slate" shall be salvaged "for re-use", it did not stipulate relocation.
Heritage body An Taisce, along with dozens of local residents and politicians, had opposed the planned demolition.
An Taisce said: "The chapel is a good quality gothic revival-style building, constructed in granite with brick dressings and is one of the few historic buildings remaining in the St James' hospital complex."
It added that "poor regard" is being shown "for the heritage, culture and collective memory of the Dublin 8 area" by seeking to knock down the building.
The chapel is not on the list of protected structures.
Synchrony is to demolish the old chapel to make way for an eight-storey hospital building.
A representative of the consortium could not be contacted for comment. Residents in Kilmainham, South Circular Road, and Rialto, as well as councillors Clare Byrne, Criona Ni Dhalaigh and John Gallagher, all sent letters objecting to the demolition.
Cllr Byrne (FG) said she was one of three councillors who began a process through the council to give the building protected status.
"It was agreed to initiate the process to add the building to the list of protected structures. However, this process was halted by DCC, so the status of the church is not clear," she said.