Several members of the City Plans Panel had doubts over elements of the scheme proposed for the First White Cloth Hall, which dates back to 1771, but they chose to back the application put forward by developer Rushbond amid fears it is the last chance to save the grade II listed site.
Rushbond presented a scheme which included reinstatement of the west wing, a new covered courtyard with atrium, new shopfronts and uses for retail, financial and professional services, cafes and bars to the building on Kirkgate - one of the most historic sections of the city centre.
It was the style of the shop fronts, which were dubbed 70s like, and the use of glass screens and modern methods in such an old building, which were the main issue.
Coun Colin Campbell said: "It is a building of such importance that creates controversy whatever you do with it. I really don't like the shop fronts, they don't work. It makes it difficult for me to vote but if I don't, we might never see it again."
Coun Graham Latty added: "It looks like a very modern building in the oldest street and looks totally out of place. That I don't find attractive at all. The word pizazz had been used and that is not something I had thought. But of course we are going to have to do it (support the application)."
Earlier Joanne Needham, for the Society of Prevention of Ancient Buildings, had slammed the proposals and said the council was "perverse" in its pursuit of the scheme.
She said: "The society remains committed to see a positive outcome for this building but it should not be at the expense of architecture and historic interest. The importance of the rarity to the region and the country is recognised by your council, it is perverse and worrying that the council and its stakeholders continue to chase a scheme which puts this already vulnerable building at even greater risk of collapse and loss."
She said there was no structural report and the proposed scheme shows no approach to conservation and design, adding: "This scheme is driven by aesthetics rather than conservation practice. The results of consultation should be secondary to the building's need. Greater need is given to what would be popular rather than what the building can stand."
She asked the panel to pause and consider if the application is the only option and solution available but legal representatives stepped in to remind councillors they had to vote on the application before them.
It was also noted that the scheme is being boosted by Â£500,000 worth of ring-fenced funding from the Heritage Lottery Fund - which has to be spent by 2020.
Also backing Rushbond was Martin Hamilton, director of Leeds Civic Trust, who told the meeting they had been involved at all stages of the proposal being put together after campaigning for such a scheme for the last two decades.
He said: "This represents restoration, re-building and some modern elements. There are some concerns but for us it is about what is the greater good and that is that we support a scheme that should see this building back in use in hopefully the not too distant future.
"This could be the best opportunity for bringing it back into use and it maybe the last. On that basis the Civic Trust supports the application. We could hold on for the perfect scheme and that might be in six months time or 12 months and by then there might not be a building to save."
There was a proposer to approve the recommendation and councillors voted in favour.
Coun David Blackburn said: "Let's get on with it. It will be a good development and bring back something that has not been there for donkeys years."