Chiltern Railways has won permission to build a £130 million new rail line between Oxford and London.
It will be the first new rail link between London and a major British city for 100 years.
The train company plans to start running services between London Marylebone and Oxford from 2015.
This work brings Chiltern’s total investment in the line to £600 million since the start of their franchise.
The scheme, approved by transport secretary Patrick McLoughlin, will see new stations built in Bicester and north Oxford.
A new parkway station in north Oxford will be located at Water Eaton, linking trains, buses, cars and bikes allowing passengers to avoid the congestion of central Oxford.
Bicester Town station will also be redeveloped to provide a gateway to the town next to the Bicester Village fashion outlet centre.
Chiltern Railways business development director Graham Cross said: “We are pleased to have been granted the power to proceed with this significant railway investment, which will benefit thousands of commuters and businesses in Oxfordshire and Buckinghamshire.
“The Oxford to London link is the latest in a long line of innovative Chiltern-led projects to upgrade the rail infrastructure, fuelled by our understanding of rail’s potential to make a significant contribution to economic growth and prosperity.”