West Northamptonshire Council has allowed The Green Room to serve alcohol until midnight from Monday to Thursday, 1am on Fridays and Saturdays and 11pm on Sundays.
The Bridge Street tapas bar can also to play recorded music indoors until 1am midweek, 2am at the weekend and 11pm on Sundays.
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The owner and general manager of Unicorn Hotel next door had raised concerns about the potential for noise disturbances.
But the council's licensing sub-committee approved the application after a hearing on July 7.
"The sub-committee received three objections to the application and considered all of the written representations ahead of the hearing and the issues raised," the decision notice reads.