The level crossing in Glenroy will be removed by lowering the rail line beneath Glenroy Road.
A new Glenroy Station will also be built, with safer and more modern facilities.
Glenroy Road level crossing will be gone by 2022.
Glenroy Road is one of the most congested roads in Melbourne’s north, with about 19,000 vehicles passing through the level crossing each day.
The boom gates can be down for up to 43 per cent of the morning peak, causing traffic to bank up for up to a kilometre along Glenroy Road.
More information about the design of the rail trench will be available later this year.