Gateshead Council gave the go-ahead to an application by housing association Gentoo this morning to build 30 homes on land north of Gullane close, in Bill Quay.
South Tyneside Council was among those who raised objections over loss of green space and wildlife habitats.
A spokesman for South Tyneside Council said: “We submitted our views on the proposal but accept that this was ultimately a matter for Gateshead Council to determine.”
Others campaigners are concerned about decreasing boundaries between different communities south of the river.
Rob Storey, of Bill Quay, who helped lead protests during a site visit by members of the Gateshead Council Planning and Development Committee, said he was disappointed by the decision.
“It’s about urban sprawl,” he added, “it’s going to lead the way to other developments, there’s already 250 houses been built within spitting distance of the development.
“As a community we feel under siege.
“It’s going to completely change the tone of living in Bill Quay.”
The easter edge of the site runs alongside the border which separates Hebburn and South Tyneside Council from Bill Quay and Gateshead Council.
The application sought permission for 18 four-bedroom houses, 11 three-bedroom houses and one two-bedroom bungalow.
Among those opposing the scheme was Jarrow MP Stephen Hepburn, whose constituency includes the area.
A petition of 499 signatures opposing the plans was submitted and 316 individual objections were also logged by the council.
Mr Storey added: “We’ve said consistently throughout that we understand that times change and we need to build homes.
“But there’s plenty of brownfield sites around Gateshead designated for housing and this isn’t one of them, the council has designated this a wildlife corridor.
“In terms of the weight of evidence put forward, we’re really disappointed with the ways things have gone.”
James Harrison , Local Democracy Reporting Service