The Mayor's office says that the Northern Line extension will reduce pressure on Vauxhall station and existing Northern Line services, in addition to boosting the area's economy.
It is expected that work on the line could begin by 2015, with services in operation by 2020.
A consultation on the plans is already underway.
More top news
A sea of tweed snaked its way through London today as the most dapper among us donned their finest and got on their bikes.
A protest is being held today against the closure of gay pub The Black Cap in Camden.
Four QPR hooligans caught on CCTV reeking havoc and attacking rival fans have been jailed.