Some housing land near rivers in Carmarthenshire may have to be struck off due to concerns about pollution.
The council is having to amend its new planning blueprint for the county - called a local development plan (LDP) - because of stricter targets for phosphates.
Environmental regulator Natural Resources Wales (NRW) is worried about high phosphate levels, which can damage river plants and wildlife.
At present, more than 60% of waterbodies in Wales fail the stricter targets, and councils have been asked to take more action in catchment areas which are in special areas of conservation (SACs) to avoid further deterioration of the environment.
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A Carmarthenshire Council cabinet report said: "These implications are inevitably significant and may require 'de-allocation' of a number of housing sites in the affected catchments."
The council has been drawing up its new LDP for years and had hoped it would be adopted this summer, but 527 homes earmarked in the plan are affected by the phosphate guidance from NRW.
Almost all of the housing sites affected are in the river Tywi and Teifi SACs, in the north of the county. More work would be needed, including input from Welsh Water, before it was clear which of them could be retained.
The main sources of phosphates in rivers are agriculture run-off and fertilisers, and sewage. In large quantities they can lead to a dramatic growth in algae and deplete oxygen levels when they enter the water.
The phosphate issue has left many planning applications in affected areas in Wales in limbo.
In England, fields have been left fallow in some instances in order to reduce phosphate pollution, while some developers have even built private wastewater treatment facilities on their sites.
Cabinet members in Carmarthenshire agreed a series of recommendations at a meeting on February 14, including amending the LDP and setting up and leading a River Tywi nutrient management board.
Introducing the report, Cllr David Jenkins said: "There remains specific and challenging issues in progressing the LDP in its current form."
New nutrient management boards in Wales are being set up to consider whether development proposals negatively impact on phosphate levels in their catchment area. Ceredigion Council would take on the lead role for the Teifi, Pembrokeshire Council for the Cleddau, and Powys Council for the Wye.
Cllr Linda Evans said: "It's really important that work on the nutrient management boards starts as soon as possible."
The council is finalising work on a new "phosphate calculator" to help its work in this area, and it has a web page on the phosphate issue aimed at developers, householders and farmers.
Speaking at the cabinet meeting, Rhodri Griffiths, Carmarthenshire's head of place and sustainability, said the council's phosphate calculator would be the first of its kind in Wales.
"We are working with partners to smooth the introduction of that calculator," he said.
Meanwhile, further amendments to the LDP in its current form are possible because councils are having to assess potential flood impacts of developments following new planning guidance by NRW. This guidance was meant to come into force at the end of 2021 but was then delayed to 2023.
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