The east London club is moving to the former Olympic Stadium for the start of the 2016/17 season and its old stadium will now be converted into a residential development.
The application was submitted by Barratt Homes and Galliard Homes and the approval comes after more than a year of robust negotiations between the council and the developers.
Newham Council initially criticised the developers for failing to include any affordable homes but under their current offer, 25% or 211 of the 842 planned homes will fall under the affordable category.
Sir Robin Wales, Mayor of Newham, also announced plans to invest an additional £18m into the site to increase the number of affordable homes to 295.
Sir Robin said: “I want to open this historic development up to even more of our residents, that is why I intend to make this investment of £18m to raise the percentage of affordable housing up to 35%.
“Other developers must provide affordable housing as part of any regeneration proposals they bring to us.
“We will do all we can to ensure as many homes as possible are within reach of our residents.”
Councillor Ken Clark, Chair of the Strategic Development Committee and Executive Member for Building Communities, Public Affairs, Regeneration and Planning, said the council had worked with the developers to maximise the number of affordable homes available.
“The progress we have made has been incredible, moving from zero to 25% affordable housing on site,” said Councillor Clark.
“We are proud of Upton’s Park’s diversity and sporting legacy and we have always made it clear the redevelopment must work for the whole community.
“I am proud to have scored a hat-trick with this scheme – with hundreds of affordable homes, jobs and a lasting legacy for the area.”
The Boleyn Ground is of historic significance to Upton Park as it has been the home of West Ham United Football Club for 112 years.
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