The specialist method, which has been used for more than a decade in Europe, will use two robots which will slowly “eat away” at the building from top to bottom over eight months.
The company contracted to do the job says the robots will allow Barangaroo Reserve to stay open to the public while minimising disturbance to local businesses and residents.
"We're on a headland, or in a park, we're close to residences and housing so this application is very low impact and suits it perfectly," Liberty Industrial director Clinton Dick said on Tuesday.
The decision to remove the tower at the head of the reserve comes after no alternative uses for the building could be found.
"We looked at a number of re-use options and it just wasn't viable," Barangaroo Reserve project director Peter Funder said.
"It completes the vision we're trying to deliver here of recreating the headland of Barangaroo."