Horror as young woman's dead body is found outside apartment in Footscray, Melbourne

A young woman is dead and a teenage girl is in hospital under police guard following a stabbing in Melbourne.

Emergency services were called to the former Royal Hotel in Footscray around 2am on Thursday following reports of an altercation. 

A young woman suffering from stab wounds was found dead at the scene. 

A teenage girl was arrested at the scene and taken to the hospital for medical assessment, where she remains under police guard.

The former hotel site on Barkly Street is now understood to be an apartment complex, Seven News reported.

Homicide detectives and forensic officers remain at the cordoned off scene near Footscray's main shopping strip on Thursday morning.

No other details are available at this early stage. 

Police urge anyone with information, CCTV or dashcam footage to come forward.