The Western Bulldogs have been saved from financial disaster after a town planning wrangle threatened to bring down the AFL club, it was revealed.

Bulldogs chairman David Smorgon confirmed the Victorian government had stepped in to overrule the Maribyrnong City Council, which had refused to approve plans for Victoria University to run courses in the redeveloped Whitten Oval complex.

That would have left a $6 million shortfall, a half-finished administration building, and the Bulldogs facing possible financial ruin.

Instead the Victorian government has used its power to ensure the redevelopment can continue, assuring the Bulldogs' future.

"We're relieved. If it wasn't for the state government intervention, the future of the Whitten Oval redevelopment was in jeopardy and the future of our club was looking pretty bleak," Smorgon told the Nine Network.

Bulldogs chief executive Campbell Rose said if the government had not stepped in to force the council's hand, the club would have only had until the end of the month to sort out the dispute.

Then the builders would not have been able to continue because of lack of approvals.

"The screws were tightening as things were going so well on the field," Rose told News Limited web sites.

"There would have been a $6 million gap. We couldn't access the money because of contracts in place and we needed that permit."

In contrast to the off-field drama, the Bulldogs have been flying on the field, winning 13 of their 16 matches this season to sit second on the AFL ladder.

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