A huge waste management facility would also be built on the site of the Edwin Richards Quarry in Rowley Regis, if the scheme went ahead.
FCC Environment is leading the project to overhaul the quarry, which has lain dormant since 2004.
The firm claims it is offering a 'realistic and deliverable restoration' of the site.
It is hoped the homes will be built by the beginning of the next decade, but the overall project to fill in the land could take up to 30 years.
The waste facility would treat 150,000 tons of soil a year, while a gas utilisation plant and a waste vehicle depot would also be built.
The company hopes the quarry will eventually be turned into a green space for use by residents.
The proposed development would regenerate the land and provide an extension to the community of Rowley Regis, bosses add. The 281 homes would be built on the southern end of the site, under the plans.
FCC said it was not 'practical, sustainable or desirable' to leave the site as it is.
In a statement, it said: "The site as it stands presents health and safety management issues in terms of public access and has limited end-use to the wider public."
A design and access statement submitted with the plans said: "The new homes will create a cohesive neighbourhood that will be well connected to, and integrated with, existing residential areas and can take advantage of local services in the immediate area, at Lion Farm and in nearby Blackheath centre.
"The scheme will enable the phased delivery of high-quality market homes with local play areas, informal open space and sustainable urban drainage systems, creating a landscape and ecological framework that retains valued natural features and links the site to the wider green network and footpaths.
"Additional landscaping associated with the open space and site boundaries will enhance a derelict site and present a pleasant public face to users of Portway Road and adjacent homes."
The firm says the homes could be built within the first five years of the project. It is likely to be split into two or three phases.
The main access to the development would be from Portway Road. Members of Sandwell Council's planning committee will consider the application on Wednesday.
But the members could decide to organise a visit to the site, putting a decision on the proposal back to June 24.
Rowley Regis councillor Chris Tranter said he supported the plans to develop the quarry, but raised concerns about the impact vehicles travelling to the site during the project would have.