North Kesteven District Council has approved a plan for 25 new homes in Leadenham.
The proposal will see the homes built off main road in the village by Heyford Developments Ltd.
Developers had submitted plans for 33 houses on the site, but reduced the amount after further assessment of the proposal.
As part of the development, a total of 12 four-bedroom, nine three-bedroom and four two-bedroom homes would be built.
Six of the properties will be allocated for affordable housing.
The developer said in its plans that the site would help to create a “community for the future”.
It said: “It is believed that the use, amount and type of development is appropriate for the site and is well related to the surrounding developments in Leadenham to help create a sustainable community for the future.”