The former Shaftesbury House hostel in Beeston is being converted into the Greenhouse, 172 flats that will be the UK's first carbon-negative homes.
Already attracting interest from across Europe, at the heart of the scheme is a range of energy-saving measures including a 328ft-tall, off-site wind turbine that will be one of the tallest structures in the city.
The development will also include ground-source heat pumps, rooftop wind turbines, rooftop solar heating and the latest insulation techniques.
All of the innovations combine to drastically reduce emissions of carbon dioxide, believed to be one of the main contributors to climate change.
Each year the greenhouse development is expected to save two tonnes of carbon per flat compared to a conventional modern apartment, as well as cutting energy bills by up to a one-third when compared to traditional homes.
It is also planned to introduce a car-sharing scheme for Greenhouse property owners using electrically-powered vehicles and a bike-hire service.
Prices for the new flats start at £59,000 and they are already proving a hit, with 130 sold off-plan within one week.
The project is also expected to make a major contribution to the city council's plans to regenerate Beeston.
Mac Maclean, director with Citu, the developer behind the scheme, said: "With Greenhouse we are touching the nerve of the nation.
"This is the most exciting development we've been involved in and will make a massive positive impact. Beeston is a developing inner-city area with a great community."
Environment Secretary Hilary Benn, whose Leeds Central constituency includes Beeston, recently visited the scheme during the latest round of public consultation.