But they immediately ran into criticism from housing campaigners, while environmentalists highlighted shortcomings in the whole Dome project.
The scheme, which will be at the heart of the Dome celebrations in Greenwich, south-east London, is intended to encourage a thriving community of private home-owners alongside social housing.
The properties will incorporate the latest energy-saving and high-tech building innovations in a 32-acre site of steel- and timber-framed homes.
Mr Prescott said: "This is an exciting opportunity to create a community built to the highest quality of architectural design, which embraces a mixed use approch and addresses environmental and energy conservation issues."
A consortium including Taylow Woodrow, Countryside Properties and the Ujima Housing Association submitted the plans which have been chosen by the Government for development.
There will be 172 homes for rent and another 94 available under rent/buy schemes out of a total of 1,400.
But Shelter expressed reservations about the development which appeared to fall short of its recommendation of 40 per cent social housing.
Chris Holmes, the housing charity's director, said: "The Millennium Village provides a unique opportunity to think about how we want to live in the 21st century. The health of the whole community will only flourish if those who are most vulnerable are provided for at the heart of this project."
Jenny Bates of the Friends of the Earth, welcomed the eco-village and said it could be a model for other developments around the country.
But she said, apart from the Dome and the village, there was a third part of the site set aside for a large retail development with car parking which was "not much greener than a pile of toxic sludge".Reuse content