The Arlington County Board narrowly approved a $125 million residential-retail project near the county courthouse yesterday. The project became possible when 22 homeowners who had united to maximize their profits sold their properties to a developer.

After nearly four hours of discussion, the board voted 3 to 2 in favor of the plan, assuring residents of the Courtlands neighborhood that they will be able to sell their 50-year-old homes to a Bethesda developer for prices estimated at more than double the houses'assessed value. Construction could start this summer, the board was told.

The vote climaxed more three years of work by the homeowners to take advantage of the multimillion-dollar construction boom around the Courthouse Metro stop.

"I'm totally convinced we will leave behind a monument to the county," said Thomas A. Clary, a retired federal land use specialist who helped organize the sale.

The plan by Courchevel Corp. calls for replacing the houses with a 594-unit rental apartment building having 75,000 square feet of retail space that will include theaters, restaurants and a supermarket. In return, the homeowners will share in nearly $10 million for their six acres of land. The site, bordered by Fairfax Drive and North Barton, North 14th and North Wayne streets, is a block from the site of a planned multimillion-dollar high-rise complex on county-owned land.

The major issue over the Courchevel plan, which led board members Ellen M. Bozman and Albert C. Eisenberg to oppose it, is the height of the complex, which is to be 17 stories at North 14th Street and to taper down to 10 stories on the Fairfax Drive side.

Bozman and Eisenberg wanted fewer stories, particularly on Fairfax Drive, which will be closest to the remaining single-family homes in the neighborhood. Their position was supported by several Courtlands residents who are not part of the neighborhood land deal, and by residents of nearby neighborhoods who said they feared that approval would establish a precedent for high-rise development in their neighborhoods.

"I'm very disappointed," said Jeff Zinn, an official of the Courtlands Civic Association, who is not part of the land sale. "I think it has the potential to hurt some of our property values."

While all five board members said that they preferred lower heights, Chairman John G. Milliken noted that the heights were within the limits approved for the area five years ago. He said that the board would not allow the decision to set a precedent for other neighborhoods near Metro stops.

Milliken and board members Mary Margaret Whipple and Michael E. Brunner, who joined with him in approving the plan, said they were swayed because of Courchevel's plan to build rental housing. The board has struggled for years to persuade developers to include more residential buildings near Metro stations.

Some Courtlands neighbors withdrew from the sale in hopes of attracting more lucrative office developments on their land. But board members yesterday indicated that they intend to stick to plans for residential development of the block, which extends from the site approved yesterday to North Veitch Street.