Derrian Catto-Pitkin first approached the Mercury last Friday after $500 worth of Christmas decorations were stolen from the front of her Hamilton Street house.

The family also erected a large sign saying, "To the person who stole our Christmas lights, please return, no questions asked, 4 small children very sad".

She said following the story, she had been contacted by kind-hearted neighbours who had donated Christmas lights.

One stranger even left a toy bear with Christmas lights draped around it.

Ms Catto-Pitkin said her family, especially her four small children, were "over the moon".

"Most people expressed the same sentiment as us - they couldn't believe someone could take our lights," Ms Catto-Pitkin said. "And straight away that afternoon once we had the sign out the front our neighbours from across the road brought out some lights they were no longer using.

"[The children] were very grateful and very surprised someone would do that."

The Catto-Pitkins family wasn't the only Fairy Meadow family targeted by thieves last Thursday night.

The Rice family, who live on nearby McMahon Street, also had their Christmas decorations stolen, and Ms Catto-Pitkin has shared some of the lights donated to her with them.

"I think it's lovely people felt they wanted to do something to cheer the kids up," she said.

"It's very touching but it's disappointing the people who pinched them couldn't step up."

The theft has been reported to police, however Ms Catto-Pitkin said she thought it unlikely the lights would be recovered.

She has also taken a more cautious approach to decorating her home, placing the donated Christmas lights inside her window instead of around the outside of the house, and said the family was unlikely to replace the stolen reindeer and Santa decorations.

One Fairy Meadow resident has reported seeing three children walking away from the Rice's McMahon Street property about 2am last Friday.

Anyone with information should contact Crimestoppers on 1800 333 000.