The proposal for the 6.2 hectare site includes residential, office and education uses, as well as retail, cafes, bars, restaurants and parking.
The former Army base was acquired by the Department for Social Development in 2004.
Mark H Durkan said: "This is great news for Derry and the wider region."
"This is a major regeneration site in the City and the approval now provides certainty on the scale and type of development that will be acceptable," the minister added.
"It also allows work to be completed on the decontamination of the site and ensures that the site is ready for inward investment.
"I believe that this approval will also serve to reinvigorate this part of the city both physically and functionally."
The plans provide for up to 82,274 square metres of floor space and allows for the decontamination and infilling of the site.
In 2011, it was revealed that the Ministry of Defence was spending more than Â£3m decontaminating Fort George.
It had been polluted with heavy oils and diesels, as well as small amounts of heavy metals and Japanese knotweed.
The contamination of the site and its location within the city's flood plain presented a number of environmental and traffic impact issues.
Social Development Minister Mervyn Storey said he was pleased those issues had been resolved.
"This is a major step towards the further redevelopment of a strategic site which, as the success of the Science Park shows, can host the type of employment that will create real social and economic benefits for the city," he said.
"I am pleased that my Department, in liaison with DoE, has been able to overcome each of these challenges and put in place a blueprint to guide all aspects of the future development of the site."
The environment minister has given his approval for the major regeneration of the former Ministry of Defence site at Fort George in Londonderry.