The masterplan includes plans for business and technology parks, an education campus, three hotels, a museum and enhanced spectator facilities.
According to developer Silverstone Holdings, the project will generate around 8,400 jobs over its lifetime.
South Northamptonshire Council leader Mary Clarke said: "Approval of this masterplan, which secures major international investment in the future of Silverstone Circuit, is a key strategic decision for this country. Development around Silverstone race circuit will now continue at a pace despite the continued economic downturn."
The approval of the masterplan is subject to ongoing section 106 agreement negotiations.