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Melbourne Heart Striker Eli Babalj, who was the club's top scorer last season, has signed a two-year deal with Serbian club Red Star Belgrade.

Melbourne Heart Striker Eli Babalj has been snapped up by Serbian giants Red Star Belgrade.

The former European champions have signed the talented 20-year-old on a two-year deal following a breakthrough 2011/12 season, in which he netted nine goals in 22 games to become the Heart's top scorer, helping propel them a debut A-League finals appearance.

Babalj was reportedly tracked by Red Star's coach Robert Prosinecki throughout last season.

Heart coach John Aloisi admitted Babalj will leave a significant gap in his squad but was keen to label the transfer as proof of a successful youth policy.

"Our club has always been committed to presenting a pathway for talented youngsters, offering the training and guidance required to give players the best possible opportunity to advance their career," Aloisi said.

"While Eli will undoubtedly be missed, we won't unreasonably stand in the way of any player seeking to take the next step in their career.

"Eli's transformation over the past 24 months has been obvious to see, and we are delighted to have been able to play a significant part in shaping his growing career."

A Young Socceroo, Babalj arrived at Heart in 2010 from the Australian Institute of Sport after a stint at Perth Glory's youth side.

"I'd like to thank Melbourne Heart for the opportunity they have given me to play professional football and develop as a player over the last two years," Babalj said.

"Hopefully, one day after my European adventure, I'll be able to return to Melbourne and once again play for the Heart."