SCARBOROUGH – Voters overwhelmingly rejected an ambitious 397-unit development Tuesday that supporters had touted as a model for suburban growth and critics had vilified as too large.

Residents voted 3,069-794 to overturn the Town Council’s approval of a project known as Dunstan Crossing or the Great American Neighborhood.

The project by ALC Development Corp. called for 121 single-family homes, 185 condominiums, 51 apartments, 84 housing units for people over 55, and 50,000 square feet of office and retail space to be built on 150 acres over 15 years.

Opponents said it is clear residents agree with their contention that the project is too big and would create problems for schools and town services, and generate too much traffic in the congested Dunstan Corner area of U.S. Route 1.

“More than 3,000 people do not live in the back yard of this property. This is a townwide sentiment,” said Mary Angis, an organizer of the opposition group.

The vote is a major setback for the project, but ALC Development still has options. Elliott Chamberlain, who owns the company with his brother, said the firm will look at a possible zone change, another contract zone proposal or moving forward with a development that fits the current zone.

“It will be developed. That is a guarantee,” he said.

The Town Council approved the project by allowing a so-called contract zone off Broadturn Road to allow for such dense development.

Opponents then collected more than 3,000 signatures to force a vote asking if the council’s decision should be overturned.

Supporters said the development is an answer to the problem of sprawl in Maine. The proposal had clustered housing, recreation fields and open space, plus 50,000 square feet for shops, offices and restaurants.

The town would have received $1.5 million in annual property taxes and a $1 million fee from developers to preserve open space.

The state Department of Transportation said it would halt traffic improvements at Dunstan Corner unless the project went forward.

Evan Richert, former State Planning Office director, referred to the vote as a “sucker punch” to developers committed to what he considers the right kind of growth in Maine.

“It certainly sends a message to developers who take time to do the right thing,” Richert said.