Plans have been sent to the Government by Derby and Nottingham city councils, showing the proposed route from Nottingham to Derby, taking in Toton and Long Eaton, as well as a separate arm to East Midlands Airport via Castle Donington.
A provisional application for the start of the extension has been shortlisted for approval, meaning the councils can now submit a full bid to the Government.
Nottingham City Council has also been given £50,000 to prepare the main bid, which is expected to be submitted in the summer.
Under new designs which have been produced as part of the bid, the line to Toton park and ride would be extended to the yet-to-be-built HS2 station at Toton sidings.
After this was completed, and if more funding can be found, the line could then split with one route going south and another continuing west.
The southern line would go through Long Eaton, going under the M1 near Junction 24a before stopping at the new Strategic Rail Freight Interchange, and then heading on to East Midlands Airport.
The western line would go under the M1 at Junction 25, before passing by Breaston and Borrowash and finishing in Derby city centre.
Shorter extensions were also being considered to be included in the main bid. These include to the yet-to-be-built 3,000 home development at Clifton pastures, and a second through Netherfield to Gedling
A Nottingham City Council spokeswoman said: “There is a long term aspiration to improve connections to East Midlands Airport, which is being explored regionally through the HS2 Growth Strategy.
“Our focus at the moment through Transforming Cities is on exploring the feasibility of short extensions such as in Clifton and to the HS2 hub. The results of these studies will determine whether tram network extensions form part of our bid.”