It was the final major barrier to building an additional 20,000 homes in the city over the next decade.
The Local Development Plan (LDP) sets out where new houses can be built, based on a forecast that the population will grow by a quarter over 20 years.
Cardiff council said the city was in "dire need" of the plan, to help it manage its growth.
A final decision will be made by the local authority in the coming weeks, but it is expected to be rubber stamped by the council.
Under the plan:
The inspector has not given as much protection to the greenbelt on the edge of the city as a number of councillors and residents had campaigned for.
The process has been long and controversial.
Supporters say the expansion is needed to deal with the shortage of housing in the city, while opponents claim the city's infrastructure will not be able to cope.
The plan is based on projections of a growth in the population from the 320,000 to nearly 400,000 over the period between 2006 and 2026.
The last time Cardiff grew at this scale was at the height of the coal industry a century ago.
Cardiff council cabinet member for planning and sustainability Ramesh Patel said the city was "in dire need" of the plan.
"The last plan was approved 19 years ago and has led to insufficient land being made available for urgent housing needs," he said.
"When the new plan is finally adopted at the end of January, we will ensure that developments in the city are managed effectively with new transport infrastructure, schools, health facilities and other community facilities.
"The plan gives us the control to guide development and manage the growth of the city."

The pair from Haverhill have won the UK's second biggest ever lottery prize after being the only winners in Friday's lottery draw.
Camelot said the pair would reveal their plans for the future on Tuesday at Down Hall Country House Hotel in Hertfordshire.
The lottery organisers said the total prize money won by the couple was £148,656,000.
Camelot said the lucky ticket holders would be revealed at the hotel in Hatfield Heath, near Bishop's Stortford, at 11:30 BST.
A National Lottery spokeswoman said: "We are looking forward to welcoming the ticket-holder into our millionaires club, joining the 2,900 millionaires created by the National Lottery to date".
The ticket is the second biggest National Lottery win behind Colin and Chris Weir from Ayrshire, who scooped £161m in July 2011.
It is also the second winning ticket by a couple from East Anglia in less than a year after Dave and Angela Dawes, of Wisbech, Cambridgeshire, won £101m in October.
The winning numbers were 11, 17, 21, 48 and 50. The lucky stars were 9 and 10.
It is the seventh Euromillions jackpot to be won in the UK so far in 2012.
In Friday's draw another UK millionaire was created in the Millionaire Raffle Selection game, with the winning code JDW 016965.
Camelot said to date Euromillions players have raised £28bn for National Lottery Good Causes.
Watch live coverage of the winning couple's TV interview on the BBC News website at 1130

Figures from eight health trusts showed 53,024 people visited between 1 and 25 December, but only 29% needed emergency treatment.
Other inappropriate visits during the period included patients with colds or excessive alcohol consumption.
Health bosses warned that seriously ill patients could be put at risk.
Source: Hospital trusts in the north east
The figures were released by hospitals including Newcastle's Royal Victoria Infirmary and Freeman Hospital, Sunderland Royal Hospital, University Hospital of North Durham, Darlington Memorial Hospital and Gateshead's Queen Elizabeth Hospital.
Speaking on behalf of the hospitals, David Evans, chief executive of Northumbria Healthcare NHS Foundation Trust, said: "Many of the attendances the region's hospitals are seeing are for common winter illnesses such as bad colds, viruses or stomach bugs, which always circulate in the community at this time of year.
"These are best looked after at home with over the counter medication, plenty of fluids, rest and recuperation - they certainly do not need a trip to A&E."
A controversial plan for the biggest expansion of Cardiff in a century has been approved by a planning inspector.
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A couple from Suffolk have won £148m on the Euromillions lottery.
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People requesting treatment for broken finger nails and toothache at A&E departments in the north east has prompted a warning about misuse.