The plans were backed by Bristol City Council in November 2009 who said they were "minded to approve" the scheme.
The Government Office for the South West could have called the plans in, which would have led to a public inquiry.
'Significant step'
The club's updated plans, which include new transport proposals, will be considered by the council in the next few months.
Bristol City chief executive Colin Sexstone said: "This is great news and another major hurdle overcome.
"The decision by the Secretary of State to let Bristol City Council determine the application is a significant step forward.
"It has been the culmination of nearly two years of hard work to bring the project to this stage."
Environmental groups opposing the development had claimed endangered wildlife would be put under further pressure and transport links would not be capable of coping with increased traffic.
The stadium relocation depends on the club finding a buyer for Ashton Gate.
Sainsbury's has signed an agreement to buy the land at Ashton Gate and has also recently submitted plans for a new supermarket.
Source: BBC Sport
Source: BBC Sport