A company which wants to expand will have to take the local owls into account.
Measures to protect the birds will be written into the conditions of planning permission to convert former farm buildings into light and industrial use.
The plan for a site in Chichester Road, Selsey, has been put forward by steel fabricating company TSMS Ltd.
The buildings were checked by an expert on environmental issues who found they were being used by nesting barn owls.
But a report to Chichester District Council says: "In principal it is acceptable to convert farm buildings as both owls and bats quite happily co-exist with humans if suitable provision is made for them."
District planners are set to approve the scheme.
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