Dartford Borough Council granted detailed planning permission and listed building consent allowing house builder Ward Homes and PJ Livesey Group, which specialises in converting historic buildings, to make a start on the Grade II listed Stone House Hospital.
Under the deal, Ward will build 167 newly built houses and apartments, including 23 affordable homes available through housing association Moat, while PJ Livesey will deliver 93 converted houses and apartments.
The 15.1 acre site has remained vacant since the National Health Service closed the former hospital in 2007.
James Woodmansee, development director at the PJ Livesey Group, said: “We are delighted that after many years of hard work and a lot of blood sweat and tears, work can now finally start on this very important and historic site.
“It has been a real team effort and we intend to be on site as soon as possible to bring these buildings back into use.”