The development proposed for a 17-acre former factory and museum site near Beverley Minster has now been approved by the Government, as first reported on the Mail's website yesterday.
The scheme, which would create about 640 jobs, would include shops, restaurants, a hotel, cinema, homes, offices and a new college.
East Riding Council had approved the plans, but they had to be referred to the Government, which held a public inquiry because of the scale of the scheme.
Council leader Councillor Stephen Parnaby has welcomed the final go-ahead. He said: "This is a once-in-a-lifetime opportunity to regenerate an important part of Beverley close to the Minster and the development is set to change the face of the town for future generations."
The consortium behind the scheme – Wykeland Group, CP Group and Quintain Estates and Development Plc – is now working on an application for detailed planning consent that will lead to the first phase of construction.
A spokesman said: "After over four years working with the many people in Beverley who want to see this brownfield site transformed, we are delighted to receive this positive decision from the Secretary of State."
A £23m new campus for East Riding College had been earmarked as the first phase of development.
But a funding blow from the Learning and Skills Council, which was unable to confirm a £12m grant, has caused a setback for this scheme.
The college's director of resources John Doris said: "The original 2011 date for opening a new college on the Flemingate site will be put back a year or two, but we remain committed to delivering new vocational facilities following on from the new campus recently opened in Bridlington.
"The decision to grant outline planning permission now enables us to reconsider the details of our plans."
Beverley and District Chamber of Trade chairman Phil Guest insists the shop plans must not threaten the town centre.
He said: "It's very important that all the details of the scheme are fully examined because it is such a big scheme for Beverley.
"The aesthetics of the scheme are also important, we don't want to look like Milton Keynes."