Bicester in Oxfordshire has been chosen as the site for the coalition's second new garden city, government sources have confirmed.
Up to 13,000 new homes are due to be built on the edge of the town, as part of the coalition's plans to help deal with the UK's housing shortage.
"I can confirm the government is putting its support behind Bicester," a Treasury spokesperson told the BBC.
An official announcement is expected on Tuesday.
Bicester is expected to get a new railway station to serve the expanded population as part of rail plans previously detailed by Deputy Prime Minister Nick Clegg.
Earlier this year, the government announced that Ebbsfleet in Kent had been picked to become the first modern garden city, with an initial 15,000 homes.
The government ultimately plans to build three garden cities, each with more than 15,000 homes.
In March, it said funding from an existing £2.4bn pot would be made available for developments being built up to 2020.
Garden cities are large-scale developments in which, according to the government, certain features can be "hardwired into designs from the beginning".
The government has said it does not want to "impose any definition of what garden cities are", but features can include "quality design, gardens, accessible green space near homes, access to employment, and local amenities".
Green spaceThe garden city initiative mimics the sort of towns built across the UK after World War Two.
In total, twenty-seven new towns were built across the UK, including Stevenage, Harlow, Milton Keynes, Corby, Cwmbran, Newton Aycliffe, Peterlee and Cumbernauld.
They were called garden cities because their layouts included large amounts of green space, and were designed to deal with an accommodation shortage caused by bomb damage, stagnation in the construction industry, returning service personnel and a baby boom.
Do you live in Bicester or nearby? What difference do you believe this announcement will make? You can share your thoughts by emailing haveyoursay@bbc.co.uk. If you are willing to be contacted by a BBC journalist, please include a telephone number.
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