Crowle and Ealand Town Council is not to formally object to plans to extend the 7 Lakes caravan site by almost 40 more static caravans.
However, a vocal minority spoke out against the plan at the latest meeting of the authority.
Members were being asked to consider the siting of 39 caravans, according to the drawing submitted with the application, all of which would be at the opposite side of the site from the A161.
Neighbours in Crowle’s Park View have objected to the proposal, fearing further incidents of the water drains overflowing, reduced water pressure, increased noise and damage to wildlife.
One said: “The park is an absolute eyesore with row upon row of different caravans and a hotch-potch of different-coloured decking with no soft planting to break it up.
“There are already in excess of 600 caravans. A small town is developing, with more caravans than there are properties in the small village of Ealand.”
And the protests were echoed by town council members.
Coun Ron Stewart said the site was expanding out of all control, and he agreed that there were more caravans than there were properties in Ealand.
He said that, along with Coun Gary DaCosta, he had tried to unravel just how many caravans had been allowed under the original planning consent.
But that view contradicts that of businesses, who see increased visitors as a boost to trade.
Some traders have submitted letters of support.