Developers are appealing against the decision to refuse planning permission to the new development just off Tanton Road at the edge of Stokesley.
The site which was chosen for development is on agricultural land located between the town and a wooded area and is outside the Local Development Framework (LDF).
Many of the objections centred around the loss of green space and potential impact on local wildlife in the area. Others were concerned about potential flooding.
The plans were refused after more than 260 objections were lodged with the district council, and which were opposed also by the campaign group Keep Stokesley Special and Stokesley Parish Council.
Derek Copeland from Stokesley Parish Council said: “This application is outside the local development framework and contrary to what residents want.
“Stokesley is a conservation area and this would have a massively detrimental effect on the town, because the application is totally disproportionate; it would increase the size of the town by about ten per cent.”
But the developers argued the development would provide much-needed affordable homes, highways improvements, street lighting and they would provide children’s play parks. They also argued that potential flood risk areas had been identified and mitigation measures proposed.