The Leeds student was killed by Sutcliffe on November 17, 1980, as she made her way home back to her student halls in Headingley.
Miss Hill had caught the bus from Cookridge Street at around 9pm and got off at a stop on Otley Road, approximately 23 minutes later. She turned up Alma Road to walk the 100 yards to her residence when Sutcliffe began to follow her, before attacking and killing her. Her body was found on wasteland near to the Arndale Centre the following day.
The plaque was designed and made by Emma Dolan, from Leeds, and laid in place on Alma Road by members of the Leeds Spinners in November last year.
It has now had to be removed due to reconstruction work taking place.
Ms Dolan said: "A while back I had some emails from the company that owns the car park where the plaque is located. They got in touch to tell me they are doing some renovations to the car park which involves moving the fence and they asked me what I wanted to do with the plaque.
"I have voluntarily taken it down while the work takes place. The company has said it is open to discussions about putting the plaque back up once the work is complete or planting a tree in remembrance of all of the women.
Labour Councillor Al Garthwaite, who represents the Headingley and Hyde Park ward, said the council is willing to replace and fund a permanent plaque for Miss Hill, with the permission of her family.
Sutcliffe, who was serving a life term for murdering 13 women across Yorkshire and the North West between 1975 and 1980, died on November 13, 2020, at the age of 74, after testing positive for Covid-19.
The serial killer avoided detection for years due to a series of missed opportunities by the police.
He eventually confessed in 1981 after he was caught in Sheffield.
Despite his 24-hour-long confession to the killings, Sutcliffe denied the murders when he appeared in court.
In May 1981, he was jailed for 20 life terms at the Old Bailey, with the judge recommending a minimum sentence of 30 years.
More than two decades later, a secret report disclosed that Sutcliffe probably committed more crimes than the 13 murders and seven attempted murders for which he was convicted.