Around 500 births will be moved from Walsall Manor Hospital to New Cross Hospital in Wolverhampton after its maternity unit was judged "inadequate" by inspectors.
The hospital said the measures were needed "to ensure the safety and stability of maternity services".
It has blamed a shortage of midwives and increased demand for care.
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From 21 March, newly-expectant women living in the west of Walsall will be directed to New Cross Hospital to receive care.
A number of pregnant women already booked to have their babies at the Manor may be asked to give birth elsewhere if they live closer to an alternative hospital.
The hospital said it had "real challenges" with recruitment and despite taking on more midwives, could still not cope with demand.
The closure of maternity services and birth restrictions at neighbouring trusts has also led to more women choosing to give birth in Walsall, the hospital said in a statement.
Almost 5,000 babies were born at the hospital last year.
The Care Quality Commission ruled services were inadequate following an inspection in January.
Dr Amrik Gill, clinical chair for NHS Walsall Clinical Commissioning Group, said: "Those mums that are diverted to the Royal Wolverhampton NHS Trust can be assured that the hospital has sufficient capacity to cope with the transfer of services to New Cross Hospital."
Richard Kirby, chief executive at Walsall Healthcare Trust, said: "We want to ensure that every mother and baby gets the highest quality care and need to get the numbers closer to what the unit was originally meant to take.
"We are continuing to invest in more midwives and the development of our maternity estate and we are investing Â£3m into expanding our neonatal unit."
A failing maternity unit is to send births to a hospital nine miles away as it struggles to cope with demand.