Commissioners Graham Brown and Annelise Tuor were greeted by about 200 peaceful protesters waving placards on a hillside overlooking the 100ha site that has been proposed to accommodate 1040 caravans, a supermarket, medical centre, gymnasium and pool and has the potential to expand the local population by 1500 people.

Wygiren Pty Ltd, the applicant behind the Toolijooa Lifestyle Village, has appealed a Kiama Municipal Council decision to reject the development on the grounds it was inappropriate for the small rural niche.

Included on site this morning were legal representatives for Wygiren and Kiama and Shoalhaven councils.

Federal Member for Gilmore Joanna Gash was one of the few people to address the commissioners at the site inspection.

Ms Gash told the commissioners development of the area into a caravan park was "morally incorrect and inappropriate".

Resident Robyn Hatton said she and her neighbours would lose their quality of lifestyle.

"We will be living in a totally different environment - 3000 people as against the 30-odd properties that are already here is overwhelming," Mrs Hatton said.

"It would totally change the character and integrity of the entire area."

Mrs Hatton was shown a photo montage of how the lifestyle village would look once landscaping had been added and asked whether this alleviated her concerns about the development.

"No, definitely not," she replied. "I would like to continue to look at the cattle."

"My husband is an artist, he has painted all around here. It's just a beautiful view as you can obviously see."

The Toolijooa Harley Hill Protection Group's Stephen Carr said he was pleased with the turn-up by the community.

"The reason for this rally is to present the area in all its glory and to try and protect it. Try and save it," Mr Carr said.

"You'd have to be Blind Freddy not to understand that this is so inappropriate."

After a site inspection, the commissioners adjourned to the homes of five key land owners, Marg Weir, Ian Elliot, Mal Lambert, Mr Carr and Rob Richmond, to hear their submissions.

The hearing was expected to adjourn to Kiama Courthouse about 3pm today.

The case will resume tomorrow at 9am.