Applicants Hack Enterprises Ltd want to build 19 chalets at the flooded former Jackdaw Quarry in Capernwray, which is home to Capernwray Diving Centre.
The site operates primarily as a diving and open water swimming centre, with a shop, café, changing facilities, office and holiday lodges.
The application is for siting 19 holiday chalets around the northern and north eastern site of the quarry, with fourteen of the chalets situated on the cliff edge overlooking the water.
An access track would run behind them, beyond which would be the other five chalets. All the chalets would be located at a higher level than the water and dive centre buildings.
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The chalets would be a mix of two and three beds over one and two floors and made of timber cladding and natural slate roofs.
Planning officers have recommended the plans be approved by councillors when they meet on October 11.