Supermarket chain Booths has won planning permission for a new store on greenfield land south of Lancaster.
The council has given the green light to the 30,000 sq ft supermarket on a four-acre site close to the university. It will replace a smaller Booths shop nearby.
London-based Commercial Estates Group had previously submitted rival plans for the council-owned land at Scotforth which included a 70,000 sq ft retail scheme and a 50-bed hotel.
The Booths plan was backed by two parish councils but attracted criticism from two city councillors who said the company had not "seriously considered" brownfield alternatives.
The company was advised by Wigan-based planning consultancy Steven Abbott Associates.
Partner Steven Abbott said: "The design of the proposed store is ambitious but also typifies the sensitivity with which Booths work to ensure their developments enhance their surroundings in a sustainable and responsible manner.
"We are delighted, once again, to have played a key role in securing permission for another Booths store and look forward to moving forward with the scheme."