Developers Wainhomes had applied for planning permission to build up to 130 homes on the site of Key Fold Farm near Broughton.
Committee members last week unanimously followed officer recommendations to reject the proposals as they were contrary to local planning guidelines.
Coun Neil Cartwright, who represents Preston Rural East, submitted an objection letter to the plans and said he was “delighted” with the committee’s decision.
He said: “I’m not against development but we have a sound local plan which identifies where development should and shouldn’t be located.
“This decision quite correctly affirmed that Broughton has been identified as a village where large scale development would not be appropriate.”
The site included more than six hectares of open grazing land close to the Marriott Hotel and Broughton village.
Planning documents revealed at least 46 of the homes would have been designated as affordable housing.
And a new access road was proposed to link the development on Garstang Road to the A6.
The existing farmhouse and two-storey barn were to be incorporated if the application had been approved.
However, various other farm outbuildings would have been demolished for the housing development.
A report outlining the reasons for rejection said: “The proposed development would be contrary to the hierarchy of locations for focussing growth and investment...and would fail to achieve the social and environmental dimensions of sustainable development.”
Coun Cartwright, who is the Conservative group leader on the city council, added: “I also believe that the proposed development would have damaged the effectiveness of the area of separation and as such was against policy. I was disappointed that this was not included as an additional reason for refusal.”
The Lancashire Post contacted Wainhomes about the planning decision and whether there were any plans to amend and re-submit at a later date but had not received a response at the time of going to press.