It will be located on old farmland near Burtree Lane, Faverdale Industrial Estate and the A68.
Public spaces and pedestrian routes have been designed to connect into the wider garden village network, according to the Local Democracy Reporting Service.
An access road, from Rotary Way to Burtree Lane, will also be built alongside the community facilities.
Dale Morris, technical director at Homes by Esh, described approval being granted for the 130 properties as “an important milestone”.
A report to the council’s planning committee said they would “add value to the local area and help add to the vibrancy of Greater Faverdale”.
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