UP to 150 council homes for rent are to be built in Eckington and Killamarsh.
North East Derbyshire District Council announced the proposals as part of long term plans to secure high quality social housing.
The scheme involves demolition and replacing of 94 post-war, concrete panel construction bungalows across two sites.
Existing bungalows are known as ‘Tarrans’ - built following the Second World War - and the council says they have serious long term structural problems.
Consultation with tenants has also revealed problems with heating the bungalows.
The council and Rykneld Homes, which manages its 8,100 properties, are now considering a number of options for funding with a decision likely to be made this year.