Maltkiln is a 3,000-home village planned for the Hammerton and Cattal area, and aims to play a major role in addressing the district's housing need by providing "much-needed homes and jobs in a sustainable location".
But a newly-published development plan document from Harrogate Borough Council states that the number of homes to be classed as affordable is "anticipated to be within a range of 20 to 40 per cent".
The council's target for affordable homes at all new housing sites is 40 per cent.
It said achieving this figure at Maltkiln will be "challenging" as the development needs to be financially viable.
Yet the council also admits the affordability of homes is a "key issue" that needs to be addressed as Harrogate remains as one of the most unaffordable places to live in England.
Average house prices in the district are around 11 times average incomes, forcing many people out of the area.
The Maltkiln document states: "Whilst we want to strive to deliver as much affordable housing as possible, an element of flexibility will also be required.
"This is explicitly acknowledged in the justification to the affordable housing policy where delivery is anticipated to be within a range of 20% to 40%."
The document also said this range is "not out of step" with other large housing settlements elsewhere in the UK "where figures of 15 per cent, 25 per cent and 35 per cent have been set".
But councillor Pat Marsh, leader of the opposition Liberal Democrat group on the council, said the authority should be aiming for at least its own 40 per cent target in order to provide homes for those most in need.
She also said that during the creation of the district's Local Plan, her party's vision for Maltkiln was an "eco-village" which is not car dependent and has many community facilities.
Councillor Marsh said: "That eco-village had to be in a sustainable place and therefore the area around the Hammertons with two rail halts seemed an ideal place.
"Once taken up and accepted as the new settlement site, there has been a need to ensure all the right infrastructure is in place to serve the existing and new community.
"This includes schools including a secondary school, shops, open spaces and sports pitches. Also, that the houses built would be carbon neutral.
"Added to that the requirement of 40 per cent affordable homes which is very important and we should not consider the delivery of less."
The Hammerton and Cattal area was chosen as the location for the huge housing plans after rival proposals for 2,750 homes on the former Flaxby Golf Course were rejected by the council in a decision which led to a legal challenge from the developers.
The proposals for Maltkiln include two primary schools and land for a secondary school, as well as shops, employment space and a GP surgery which will be centred around the train station.
The council said it chose this location due to its transport links with the York-Harrogate-Leeds railway line and the A59.
It also said this location will "steer development away" from nearby residents who previously warned the housing plans will be "utterly devastating" for surrounding villages.
A six-week consultation on the development plan document is planned for October when residents will be asked to share their views on areas including roads and public transport.
After this, the document will then be submitted to the government for public examination.
By Jacob Webster, Local Democracy Reporter