Despite local opposition, all but one councillor recommended Tesco's plan over a rival application by Sainsbury's during a special meeting of the development management committee, held in Seaton town hall this week.
Currently there are no major supermarket rivals to Tesco's existing stores in the area and protesters at the meeting argued that Sainsbury's should be allowed to enter the town.
But Tesco's plan, which included the provision of affordable housing, a contribution towards the provision of playing fields on the outskirts of the town and a £1.7m donation to a local visitor centre, helped the retailer get the nod.
The store will have a timber frame and will be designed so rain water can be harvested from its roof.
When Tesco bought the site last year it was blamed for closing down the holiday park, one of the area's biggest employers, but it later emerged the park was already on the brink of collapse. It is hoped the regeneration plans will plough much-needed investment into the town.