Following the granting of planning permission for the canal arm into the town, Daventry District Council says it will explore funding options.
DDC said the vote in favour of granting planning permission for the 2.6km long canal, running from the Grand Union to the iCon roundabout, means it can carry out "further work to explore funding options".
The council added it will also consider in more detail the option to build a boat lift instead of one of the flights of locks outlined in the current plans.
DDC's argument in favour of the canal arm is that it forms part of its vision to encourage visitors to Daventry and contribute to regeneration and development of the area. The council's ultimate aim is to build a waterfront area in the town centre.
Cllr Colin Poole, DDC's economic, regeneration and employment portfolio holder, said: “The Daventry Canal Arm is a key part of our vision to create a thriving town, so we’re delighted it has been granted planning permission.
“It will provide a substantial increase in public open space for residents and visitors, allowing people to walk from Daventry town centre through to the Grand Union Canal, as well as boosting local employment and business opportunities.
“Now that permission is in place we can explore funding options for the canal arm, as well as detailed plans for a boat lift. This landmark structure would not only have a practical function, but would also create a tourist attraction of national – and possibly international – significance, putting Daventry on the tourism map.
“This would bring great social and economic benefits locally, but will also help to drive future investment into our District worth millions of pounds.”