Stansted will get the first new runway in south-east England since London's City Airport was built in the mid-1980s.
Alistair Darling, the Transport Secretary, approved the plan for a second runway at the airport in Essex after noting that expansion at Heathrow would be impossible in the near future without breaking European pollution laws.
Next month Mr Darling is expected to ignore the threat of a legal challenge from the airline industry when he launches his 30-year strategy for British aviation, which hopes to address an anticipated increase in air traffic.
But the airline companies said Mr Darling was making "a historic mistake" in not giving the go-ahead for immediate expansion at Heathrow. They added that the move would give airports in the Netherlands and France a massive competitive advantage.
A white paper to be published in mid-December will set out the Government's belief that building another runway at Heathrow in the near future would breach EU regulations on emissions of nitrogen dioxide, The Financial Times reports today.
Expansion at Gatwick is banned until 2019 because of a deal brokered 24 years ago with West Sussex council and a new airport at Cliffe on the Thames estuary has been ruled out because of protests from environmentalists.
Andrew Cahn, director of government and industry affairs at British Airways, said: "They should first build a runway which the market wants and where there's a demand. That is Heathrow. Building at Stansted first would be a historic mistake. It would delay the expansion of Heathrow for a generation and condemn British aviation to long term decline." Mr Cahn said BA had given the Government "clear evidence" that it could approve a new runway at Heathrow and still be "confident" of meeting the EU emissions limits.