The move – described by local MP and Education Secretary Gavin Williamson as "idiotic" – will see a huge rail depot the size of 430 football pitches built in Staffordshire.
The controversial development has been widely opposed by residents in the county, with campaigners and local MPs warning that it will destroy the green belt and cause traffic chaos.
It will see 700 acres of land ripped up close to the A5, A449 and M6 at Gailey, Four Ashes and Calf Heath, with the completed site set to feature rail links to the West Coast Main Line as well as dozens of warehouses.
Under plans signed off by Transport Secretary Grant Shapps, construction of the rail interchange will be brought forward and built when the site is filled to 25 per cent of its capacity.
A notice from the DfT confirming the decision, says: "The Secretary of State considers that there is a clear justification for authorising the proposed development."
South Staffordshire MP Mr Williamson said: "This is an idiotic decision which has left me feeling absolutely sickened. It has shown no regard or consideration for the thoughts of local people.
"The only one decent element of it is that they have made conditions about the fact that they have to build the rail interchange at the early stage of the development."
Timeline of coverage:
April 2016: 8,500 jobs promised as plans unveiled
April 2016: A boost for the region or a grave concern?
July 2016: MPs unite to fight 'disastrous' rail hub
August 2016: Expert gives damning view on £8 million rail hub
September 2018: Gavin Williamson steps up fight against Interchange
December 2019: Planning experts make recommendation to Government
February 2020: Residents in limbo as decision date looms
March 2020: Campaigners in the dark on Interchange decision
The rail interchange element of the development is expected to cost £100 million.
Four Ashes Ltd, which is behind the plans, has said the depot will create more than 8,500 jobs and bring £427m to the local economy and an extra £912m nationally.
The site will be about a third bigger than the i54 business park near Wolverhampton which is home to the Jaguar Land Rover engine plant.
A new road linking the A5 and the A449, which can be used by the public, will be built aimed at cutting out pinch points at the Gailey roundabout and Station Drive.
There are three entrances and exits to the site from a new roundabout on the A5 between the Gailey roundabout and the junction 12 of the M6, a new roundabout on Stafford Road, and Vicarage Road.
It is estimated more than 3,000 lorries and 6,000 cars and vans will travel to and from the site every day once fully running by 2035.
Nearby residents have been campaigning against the freight depot with public meetings, protests, petitions and online campaigns since the plans were first submitted four years ago.
The decision comes three months late, with the Transport Secretary had to make a decision in February after the Planning Inspectorate submitted its recommendation in November
There is no right of appeal, although campaigners could press for a judicial review with the High Court.