The £25m project to expand the airport, also known as London Ashford Airport, includes a 300m runway extension and new terminal with capacity to handle 500,000 passengers a year.

Opponents of the airport expansion, on Romney Marsh, claimed safety concerns about the nearby Dungeness nuclear plant had not been addressed.

Managers at the airport maintained that developing Lydd could take strain off the national airport system.

The runway extension would allow it to take  Boeing 737, Airbus 319 and Airbus 320 jets.

Hani Mutlaq, the airport’s executive manager, said the government’s decision was “a victory for common sense and for the people of Romney Marsh”.

The approval is subject to environmental, noise and traffic conditions.

“Once all these have been addressed, we hope to begin the runway construction work as soon as possible,” added Mr Mutlaq.

Councillor Robert Bliss, leader of Shepway Council, said the Government’s ruling vindicated the approval granted by the council in March 2010.

“The area is losing its power stations at Dungeness and there is no other significant employer waiting in the wings,” he said. “An expanded airport will have the capacity to provide a range of jobs, and this must be good for our Marsh community.”