Residents whose gardens back on to an "enormous and huge" warehouse say it is a "disaster" affecting their lives.
The 18m-high (59ft) warehouse is being built on Yeomans Drive, Blakelands, Milton Keynes, for GUPI 6 Ltd.
Linda Wardlaw, who lives "underneath it", said the development made her "cry every single day".
Milton Keynes Council, which approved the plans, said it was "a deeply regrettable situation". GUPI 6 Ltd has declined to comment.
Mrs Wardlaw said she had objected to the new warehouse for two years as it could block out sunlight and described it as a "huge, enormous monstrosity".
"I feel physically sick, I am worried I won't sell my property now. I know my health will not stand for this."
Another resident, Jackie Harris said: "It's an absolute travesty and disgrace. I feel suffocated by it, I think it's a disaster for this area."
Councillor Keith McLean, chair of the development control committee, said: "This a deeply regrettable situation. I am aware of the strength of feeling of the residents neighbouring the development and I do appreciate their concerns.
"I am working with officers to get to the bottom of what happened."
He said mistakes were made when the original decision notice was issued in terms of the conditions which were included.
"I will work with officers to ensure that the developer undertakes building and operational works within the conditions of the approval. I will also challenge officers to put in place more robust processes, such that errors such as that made with the original application cannot occur in the future."