The 400-hectare development on the site of the former BP Llandarcy oil refinery will feature around 4,000 homes, four new schools, health and sports facilities, shops and a community centre.
Councillors have also approved a new road, running along the route of a disused pipeline, linking the road to the dual carriageway at Fabian Way.
A spokeswoman for the council said: “There is room at Coed Darcy to continue building homes for the next 20 to 25 years. The granting of outline whole site planning consent comes as detailed discussions with the preferred developer, St Modwen Developments, are close to completion.
"The planning consent for some 4,000 homes, including 800 affordable homes, brings with it the provision of funding for community benefit on the site worth a total of £100 million.”