House builder Redrow Homes Midlands is building 395 houses and flats on a 40-acre site on land west of Castle Farm Way, in Priorslee.
Under the multi-million pound scheme more than £1.2m will go towards a separate new primary education provision in Priorslee.
The Holy Trinity Academy, in Teece Drive, will receive more than £400,000 in contributions to secondary facilities in the area.
The school, which has an "outstanding" Ofsted rating, is planning to increase its pupil intake from 70 to 75 to cope with the extra children.
Redrow Homes Midlands said it will be also be contributing to a new bus service, bus stop and highway improvements and the creation of a neighbourhood play facility in Teece Drive.
Sales director Pauline Turnbull said: "We are excited to be building in Telford once again.
"Our homes have always proved incredibly popular in this region, and we’re thrilled to be able to provide homes for first-time buyers, growing families and down-sizers alike, as well as further cementing our reputation for creating thriving communities across the Midlands.”
When completed, the new Abbey Walk estate near the M54 will feature public open spaces, play areas, footpaths and cycle links, in addition to ponds and mature trees.
The development won planning permission from Telford & Wrekin Council earlier this year despite objections from residents and St Georges & Priorslee Parish Council worried about traffic and security issues, as well as the impact on primary and secondary schools in the area.
But planners recommended the bid for approval based on financial contributions being made by the developer towards education and highway improvements.
The scheme involves building a mixture of two, three and four-bedroom houses, as well as one and two-bedroom flats.