Land earmarked for development as part of the cross-border Ginninderry project has been recommended for rezoning.
In a decision made by Yass Valley Council on Tuesday night, councillors voted to endorse 600 hectares of land in Parkwood on the NSW side of the development to be rezoned to residential and environmental management land.
The decision made by Yass Valley Council on Tuesday will now be sent to the NSW government for formal approval.
A final decision from the state government is likely to be made by the middle of next year.
The project is set to bring 5000 homes to area along the Ginninderra corridor, close to Ginninderra Falls.
The larger project, which has already begun construction in the ACT, will add more than 11,000 homes across the area.
It's estimated work won't begin on Parkwood until at least 2034.
Yass Valley Council general manager Chris Berry said while the first sod being turned was more than a decade away, work was already under way to get the site ready for more than 15,000 new residents.
"It's certainly a significant project, no question about it. Planning is about planning for the future and we take a long-term view of planning," Mr Berry.
"We're making sure the rules and regulations are in place so that we're ready for development, otherwise we're playing catch up rather than planning."
More than 50 submissions were received by the council in the lead up to Tuesday's decision, along with a petition signed by more than 140 people.
"The proposal for the NSW side of Ginninderry is 5000 homes, which is the development part, but the proposal is also to preserve areas along Ginninderra Creek and Ginninderra Falls in a conservation area that will be managed by a trust," Mr Berry said.
"Council agreed for the land to be rezoned and now we have to take the decision to the state planning office and they'll do their checks.
"There's still a process to go with the government to enact the changes."
Managing director of Riverview Developments, David Maxwell, said the decision by council was major step forward for the project.
"The decision by Yass Valley Council to recommend approval of the Parkwood land rezoning is a significant milestone for the Ginninderry project and comes after 11 years of consultation with council, the NSW government, stakeholders and the community," Mr Maxwell said.
"With development in NSW not proposed until 2034, the first development application for the NSW land will not be submitted to council for consideration until 2032."
However, opponents of the proposal say the decision by council was in contrast to a local environment plan set down for areas near the development.
William Ginn, the secretary of the 5 Kilometre NSW ACT Border Zone Planning Group, said they disappointed by the decision.
"It's terrible planning, and you have to question whether the Parkwod proposal is the best use of the land to build a massive housing estate right next to a sensitive environmental area," Mr Ginn said.
"We're looking at what our options are from here."