Watford’s elected mayor said preserving the Farm Terrace Allotments in the health campus scheme would mean "closing the door" on a future hospital development.
Dorothy Thornhill said the allotments were also needed to ensure the 750-home regeneration venture secured a good return for the town’s taxpayers.
Her comments come as a High Court judge will examine the legal basis of the permission the council received to build over the allotments.
The Secretary of State for Communities and Local Government, Eric Pickles, approved applications from Watford Council twice citing "exceptional circumstances" for allowing the destruction of the plots.
He said if Farm Terrace is not used the health campus would not be financially "viable" and thus deprive the public of its benefits such as "improved hospital facilities".
Plot-holders have challenged this saying when Mr Pickles made the decision he did not have all the facts in front of him, including the heath campus masterplan that shows Farm Terrace will mainly be used for houses and a new Watford FC car park.
The allotment-holders are also pointing to the fact West Hertfordshire Hospitals NHS Trust has no solid plan in place to redevelop Watford General. The trust is working on a new clinical strategy - a blueprint for future hospital services - which will be finalised next year.
This week it also emerged the trust was applying for Government cash to head-off a potential deficit of more than £120 million over the next eight years.
However this week Mayor Thornhill even though the trust had not revealed if and when it would redevelop Watford General the allotments land was needed to give them the "flexibility" to do so.
She said: "I would much rather the hospital was telling us what they needed, where and when so we could get on with the scheme. It is an unknown about the scheme but we are not going to close the door on the hospital before they have even done the clinical strategy. Only a fool would do that.
"I don’t want people complaining to me two or three years and saying ‘why do I have to go to Hemel for this or St Albans for that, why are services moving?’ It is keeping the door open. I don’t want these facilities going somewhere else. It is sticking a marker in the ground for Watford."
The mayor also said if Farm Terrace was not included in the scheme the council and its developer Kier would need to build more houses to make the scheme stack up financially.
She added: "It is the cost of the allotments vis-a-vis the cost to the development and it is not just measured in pounds, shillings and pence.
"Them (the Farm Terrace plot-holders) staying in place means the council does not get a return and that means problems for the Watford taxpayer.
"There is also an issue about the total viability of the scheme. The real issue is density. If we don’t use the allotments we will have to build more houses to make up for the loss of money. It is a viability jigsaw."