Federal Environment Minister Tanya Plibersek has given the green light to Southern Launch's proposed Whalers Way Orbital Launch Complex.
The decision paves the way for the space launch provider to launch rockets from the site on South Australia's Eyre Peninsula.
South Australian State Minister for Planning Nick Champion has the final say when it comes to the proposal.
Ms Plibersek was assessing the proposal from a Commonwealth perspective for potential impacts on threatened and migratory species and the Australian marine area.
The decision had been delayed a number of times prior to Tuesday's announcement.
Significant resistance
The project has faced significant resistance from environmental groups and local residents.
Conservationists are concerned the launches will endanger 12 bird species, including the endangered southern emu wren, whose population stands at fewer than 750.
There are also concerns surrounding the impact traffic will have on the natural environment, and the possibility of surrounding beaches closing to the public while a rocket is launched.
"We have invested significant amounts of time and money to understand the natural environment we will be operating in," said Lloyd Damp.
"We are looking forward to working closely with environmental experts to implement the first management plan for this private property and delivering a net environmental benefit for native fauna and flora found in the area."
Southern Launch has previously assured the general public that there would be minimal disturbance to birdlife beyond a "startled response", where birds left the area during launch noises but returned soon afterwards.
They also played down fears of debris landing in the ocean.
"This is an incredibly disappointing decision that flies in the face of the government's commitment to zero new extinctions," said Australian Conservation Foundation's nature campaigner Darcie Carruthers.
Plans for the Whalers Way complex have been in place since 2020, and the site was approved by the Australian Space Agency the year after.
"The Environment Minister has one job: protect the environment, but her decision today will trash this pristine part of South Australia and threaten endangered wildlife and animals," said SA senator and Greens spokesperson for the environment Sarah Hanson-Young.
"This is an insult to locals who clearly said they don't want rockets threatening their environment, or tourism and local industries, including fishing."
Southern Launch favours the site due to stable year-round weather, and low maritime and air traffic.
The base would be the Adelaide-based company's second launch site in South Australia, with the other in the far west of the state, in Koonibba.