The US Department of Housing and Urban Development wants to replace the units, which were damaged by Hurricane Katrina in 2005, with new mixed-income housing.
But critics say the development will restrict the stock of cheap housing.
Earlier, police used pepper spray and stun guns on the protesters when they tried to get into the council chamber.
Several people were treated for the effects of the pepper spray. It is not known if any of the protesters were arrested.
Following hours of debate and clashes outside the meeting, New Orleans City Council voted in favour of the government's plan to replace the decades-old structures damaged by Katrina to be demolished.
Beforehand, critics of the plan had argued it would further restrict the stock of cheap housing at a time when the city is still struggling to rebuild from Katrina. They also said the brick buildings were still sound and only needed to be renovated.
"It is beyond callous, and can only be seen as malicious discrimination," said Kali Akuno of the Coalition to Stop the Demolition.
"It is an unabashed attempt to eliminate the black population of New Orleans."
But supporters of the demolition plan argued it would allow developers to take advantage of tax breaks and build new neighbourhoods with an allotment of low-income housing.
Thousands of families from the southern states hit by Hurricane Katrina are still living in government-funded temporary housing, including caravan parks.
Published: 2007/12/20 23:32:40 GMT
© BBC MMVII