The proposed line will link the Anne de Bretagne bridge across the river Loire with the district of Rezé south of the city centre, serving the western part of the Île de Nantes and the new university hospital, which is due to open in 2026.
Preliminary studies could begin as soon as next month, although no timescales for implementation of the project have been put forward.
Nantes opened its first modern light rail line in 1985 and over the last three decades the network has grown to 44km with 83 stations.