A £5.5bn plan to revamp Battersea Power Station in south London, creating about 3,400 homes and 15,000 jobs, has been approved by Wandsworth Council.
Shops, office space and leisure facilities are promised, along with two new Tube stations on the Northern Line.
Developer Treasury Holdings UK pledged to "protect" the disused 1933 riverside landmark, which will be restored to generate green energy in the future.
But the chimneys will be demolished and rebuilt, as they are "beyond repair".
The Grade II listed building opened in 1933 and generated power until 1983.
Restoration of the main power station, including rebuilding the chimneys, will be completed by 2016.
Rob Tinckell, managing director of Treasury Holdings UK, said: "At this point they [the four chimneys] are probably going to have to come down.
"Our plan is to rebuild them, exactly like for like, using the old drawings. The problem is they are beyond repair and need replacing.
"The front two [chimneys] are going to be used for exhausting water vapour from our new bio-fuel powered energy centre, so actually Battersea Power Station will be producing power once again, but this time it will be green energy."
The 40-acre site, at Nine Elms next to the River Thames, would see 3,400 homes, of which 517 will be affordable housing, and five acres in front of the station will be transformed into a Thames Path for pedestrians and cyclists.
A conference centre, two hotels, two turbine halls - similar in principle to the turbine hall at the Tate Modern art gallery - and London's biggest ballroom will also be built.
The plan also includes a £211m package to improve transport links - two new Tube stations on the Charing Cross branch, a bus service for the area and a passenger pier to provide riverbus services from Nine Elms to central London.
Councillor Nick Cuff said: "The two Northern Line stations will spur on the regeneration of Nine Elms and bring a huge economic windfall to this part of south London."
In February the Commission for Architecture and the Built Environment praised the "intelligent" design but it also raised several issues to be considered when construction begins, including whether the heights of different buildings would block sunlight in flats on lower levels.
The power station was listed three years before its closure in 1983, meaning it could not be demolished.
Development plans that have fallen through in the past include a scheme to transform it into a theme park.
The disused station has also served as a film set, pop concert venue and even giant anti-smoking hoarding.
In 2000, a multi-million pound scheme by developer Parkview to redevelop the site as a leisure complex was backed.
The plan included hotels, a theatre, cinema, flats, a dedicated rail link from Victoria station, and a rooftop restaurants.
But the site was subsequently sold to Treasury Holdings, developers of the current plans.