The Scottish Prison Service (SPS) is developing plans for a smaller refurbished national prison for around 80 women at the site.
The SPS is also planning new community-based custody units.
It follows the decision in 2015 not to proceed with the planned construction of a large women's prison in Inverclyde.
It is hoped that the community units will allow women to be closer to their families and local support services.
About 110 prisoners were transferred from Cornton Vale in Stirling to HMP Polmont, near Falkirk, last August.
Justice Secretary Michael Matheson will formally start demolition works at the prison on Tuesday and launch a paper outlining "challenges and priorities" for criminal and civil justice in Scotland.
A Scottish government spokesman said: "This week will mark another key milestone towards the transformation of how the prison service, and other public services, work together to deal with women in custody."
Demolition work will begin this week at HMP Cornton Vale, Scotland's main female prison.