The government is due to hand over £170 million in order to regenerate housing and infrastructure.
The Hoo Peninsula is set to receive the funding from the Ministry of Housing, Communities and Local Government.
Medway Council announced in April it was putting in the bid for the funding to unlock the land.
Earlier last month, councillors decided they were going to spend more than £2m on the peninsula in order to secure the government funding.
In total, £5.5 billion from The Housing Infrastructure Fund (HIF) is set to go towards 600,000 new homes across England.
In Hoo, the money is due to go towards developing 10,600 homes as well as supporting road and rail connections.
A total of £85.7million will be used to make improvements to Medway’s roads, including the A228 and A289, as well as a new relief road to help ease local congestion.
Furthermore, £14.35 million will be used to invest in the peninsula's country parks.
Leader of Medway Council, Cllr Alan Jarrett (Con), said: “I am absolutely delighted that Medway is one of the shortlisted authorities to have successfully secured funding through the HIF.
"It was a highly competitive bidding process and Medway’s success is an endorsement of our track record of delivery.
"Providing opportunities for Medway residents remains one of the council’s top priorities and ensuring we continue to meet the needs of our residents was a huge consideration at each step of the bidding process.
“The HIF bid will enable us to significantly improve transport links and it also gives us the opportunity of providing our residents with a choice of new homes on the Hoo Peninsula.
"This great news will now allow us to press ahead to finalise our draft Local Plan setting out the future planned development of Medway to 2035.
“Medway is on an exciting journey and the area has already seen huge transformation.
"We will continue to explore new opportunities to ensure we provide sustainable growth, help the economy grow and lay the foundations for future generations as we establish Medway as a great place to live, work, learn and visit.”
Minister of State for Housing Esther McVey said: “We are investing record amounts in roads, rail, housing and broadband to ensure Britain has the modern infrastructure needed to thrive, and to allow local economies to flourish.”