GREY nomads allegedly wandering around in just their undies are being blamed for a backlash against a proposed rest area in Queensland.

Worried parents of young children are opposing plans for a free camp area for caravanners and other travellers in the tiny picturesque town of Bauble, north of Gympie.

They claim grey nomads could pose a risk to the impressionable youngsters because the proposed site being earmarked for overnight parking is too near the local primary school.

Travellers have been pulling into Bauple, once famous for its fairy grotto, for unofficial overnight camping but the Fraser Coast Regional Council now wants to formalise it by allowing free camping at the local sports and recreational grounds.

But some members of the Parents and Citizen's Association have voiced their disapproval, despite the majority of townsfolk supporting the rest area because it would pour much needed tourist dollars into the local economy.

One parent complained of seeing a grey nomad "walking around in his underwear during the day" while another camper was accused of speaking to children on their way to school.

Parents are now urging the council to consider providing an overnight camping area at Rosendale Park, a five-minute drive from the town centre.

Meanwhile, grey nomads were outraged by any suggestion they were a danger to young children.

"It's preposterous to suggest we pose any threat to young kids," Ray Clements from New South Wales fumed to Caravanning News.

"I might have more sympathy for these parents if caravanners blatantly strolled around in the nude ... but surely there's nothing wrong with a pair of underpants."

And caravanner Vic Sinclair of Queensland commented: "There'll always be the occasional oddball but I don't think underwear should be a problem. Maybe this traveller was wearing swimming togs which looked like briefs. I find it difficult to believe someone would deliberately prance around in just their undies knowing that schoolchildren were around."

Another said: "Having a rest area in the centre of Bauple can only benefit the locals. Travellers very often show their thanks by spending freely in the local shops. It's a win-win situation."