Planning permission has been granted for the transformation of a 62-acre industrial site in the Royal Docks.
The Silvertown Quays project is expected to deliver 3,000 new homes and 50 commercial buildings. It is thought the £3.5bn scheme will also create 21,000 new jobs.
The Greater London Authority owns the site in Newham and is working with the Silvertown Partnership to deliver the new development.
Work has already begun on the site; 500 tonnes of asbestos has been removed from Millennium Mills, a 1930s building that is being refashioned as office space.
Councillor Ken Clark, Newham Council's cabinet minister for building and communities, said: "Newham Council granted planning permission for this development as we believe it will aid the transformation of the Royal Docks.
"We look forward to working with the Silvertown Partnership and the GLA to bring additional homes to the borough as well as jobs and opportunities for our residents."
The Silvertown Partnership is a consortium of developers comprising Chelsfield Properties, First Base and Macquarie Capital, led by Simon Webster, who has held senior positions at M&S and Sainsbury's.
Webster wants the development to be "the next Shoreditch". The site benefits from being close to City airport, and will be connected to central London when Crossrail opens in 2018.