The 34,000m2 arrivals facility, designed by architect Pascall & Watson, will be built alongside to the current terminal and will include larger immigration and baggage reclaim areas, new retail facilities, improved access for onward transport and a public forecourt.
Construction will take up to three years to complete once work begins in autumn 2018.
The existing terminal will be reconfigured so that it is dedicated to departing passengers, providing more space at check-in, security and in the departure lounge.
The first phase of works will begin later this summer to create some additional capacity in the short-term, including extra check-in desks, additional seating and restaurants in the departure lounge.
Stansted Airport chief executive Andrew Cowan said: “The granting of planning permission for our new £130m arrivals building is excellent news for everyone connected to Stansted Airport and will transform our infrastructure and facilities to give our passengers the best possible experience. Stansted is a national asset and our investment will continue to boost competition and support economic growth, jobs and international connectivity for London and the east of England.
“At a time when airport capacity in the country is at a premium, Stansted is playing a vital role in supporting both the regional and national economy. This project will strengthen our ability to do this by enabling us to make the most efficient use of our single runway.
“We will also be investing in other terminal improvements in the short term to keep pace with increased passenger and airline demand that we expect over the next few years. This will include more check-in desks, extra seating and new restaurants in the departure lounge. This is on top of the on-going investment to improve car parking facilities at the airport. Once completed, Stansted will be the only UK airport operating dedicated arrivals and departures terminals."
The new terminal would enable Stansted Airport to grow capacity from its current planning limit of 35 million passengers a year to 43 million passengers a year. Current passenger traffic is 24 million a year but growth is expected.