The contract to construct the 4.5 kilometre extension of the Gospel Oak to Barking line will be awarded next Spring with work starting that summer.
The new line will serve one of east London’s largest new housing developments at Barking Riverside with train services commencing in late 2021.
The Overground extension will link Barking Riverside into London’s public transport network through connections at Barking, with District and Hammersmith & City services and c2c services to London Fenchurch Street and Essex.
The extension is fully funded, with £172m of the £263m cost of the scheme being met by the developers, Barking Riverside Limited.
The remainder will partially come from TfL’s Growth Fund.
Sadiq Khan, Mayor of London, said: “This is wonderful news for east London.
“Barking Riverside has huge potential to deliver thousands of much-needed affordable homes, and the extension of the Overground will ensure residents have the high-quality transport links they need, both to the surrounding area and commuting into central London.
“Barking Riverside will deliver new homes, schools, healthcare facilities and much more, and the Overground extension is a vital part of making these exciting plans a reality.”
Matthew Carpen, Project Director of Barking Riverside London, said: “This is a momentous moment for the project.
“Gaining formal consent from the Government for the Overground Extension to Barking Riverside is not only a huge milestone for the development but also crucial in connecting this new neighbourhood to the City, which will support the delivery of 600 homes a year.”