Senior councillors in South Kesteven have approved a 15,000 home local plan for the area.
The plan sets an ambition for 15,625 homes to be delivered by 2036 and includes proposals for a new garden village.
Councils are legally required to adopt a local plan in order to outline future developments and to give guidance on whether or not an application can be granted.
After being passed by SKDC’s cabinet, the plan will now go to the government’s planning inspectorate for examination.
Included in the proposals are plans for 3,700 homes in Grantham as part of the Spitalgate Heath Garden development.
The project is one of 14 garden villages planned across the country by the government.
The council has also identified employment and housing sites in Market Deeping, including proposals for 590 homes at Linchfield Road.
Grantham, Stamford, Bourne and the Deepings will be earmarked for employment and housing growth under the proposal.
South Kesteven District Council’s Cabinet Member for Economy and Development, Councillor Mike King, said: “It is important that the council proactively plans to meet the future needs of the district in order to ensure that any proposed growth can be as sustainable, in both its location and form, as possible.
“The Government is committed to an ambitious growth programme and, if at the Examination in Public it is considered that a local planning authority like South Kesteven is not actively planning to meet its future needs, then government planning policies will allow for unplanned growth to take place which is not what the council nor its communities would want.
“As a result of the Examination in Public the planning inspector can either approve the local plan as it is , reject it (in which case it would have to be re- constructed) or make proposals for amendments. The latter result is by far the most common.”