Perhaps unbeknown to the 1400-odd citizens living in Penrose, west of Dapto, their addresses have been creating havoc for the 250 villagers living in Penrose in the Southern Highlands.

So much so, that the upper-Penrosians are now demanding the name of the Dapto suburb be changed, according to a report to be considered by Wollongong City Council at its meeting tonight.

Southern Highlander and Penrose Village Store owner Lauren Sperzel said the name of the second Penrose had been causing trouble for her business - which includes a post office - since it was gazetted in 2005.

"Every single day we get something delivered which is meant for Penrose in Dapto, and that means it takes mail twice as long to get to where it's going," she said.

"It's an inconvenience in time for us, which takes us away from running our other services, and when mistakes do happen we get people becoming aggressive to us when it's not actually our problem."

Penrose in the highlands is nestled between Bundanoon and Wingello and has a general store, train station, tennis court and large area of state forest.

It has been officially called Penrose Village since 1969, according to the Geographical Names Board, but Ms Sperzel said the name went back much further.

"We've been Penrose for over 100 years, and we have a book that has been made about our Penrose in the highlands," Ms Sperzel said.

"We're just a small community but there's a lot of generations of families that live here."

"It's a bit ridiculous that [Wollongong] council would name a suburb Penrose when there's already one."

Wollongong's Penrose - sandwiched between Cleveland, Avondale and Marshall Mount - was named as such following an extensive period of exhibition and community consultation early last decade.

The council says it received "no record of any objection to the name Penrose or ... conflict with the locality name Penrose 2579 in Wingecarribee ... during that process".

The idea for the name came from the area's historic link to Penrose farm, which was settled in 1841.

A still-standing historic homestead, Penrose Villa, was built from bricks made on the farm in 1852 and was home to several generations of the Evans family - well-known Illawarra dairy farmers.

Jeff Wallace has lived in Wollongong's Penrose since 2006 - a year after the name came into effect.

Mr Wallace said it had been "a nightmare" when arranging pizza deliveries or ordering online because the computer systems had only the Penrose in the Southern Highlands.

Mr Wallace said those bugs had been ironed out and the situation was fine now.

As for the name change, he said it was too late - "the horse has bolted".

"I think it should never have happened in the first place but now you're looking at affecting 1400 residents, as opposed to 280 residents up in Penrose in the Southern Highlands," Mr Wallace said.

"It's a major impact for us. I can see the residents aren't going to be happy about it.

"It's a major inconvenience for a population that's five times more than what Penrose in the Southern Highlands is."

Deputy Lord Mayor Chris Connor - a Dapto resident - said he was fine with the highlanders' request for a name change, but said Dapto residents also deserved to be able to keep their suburb's name.

"They had the name first as a geographic name ... so I think it's fair we consider this renaming, but I think consideration should also be given to our residents," he said.

Council staff have proposed two options to resolve the clash: rename Penrose 2530 or break it up and absorb the different parts into the surrounding suburbs.

The renaming could include adding a relevant prefix or suffix - like Penrose Meadow - or suggesting a completely new name, such as the Aboriginal Elouera which means land between the mountains and the sea.

Cr Connor said he was in favour of keeping the name Penrose, but adding the word Valley to maintain the links with the suburb's agricultural past.

He said the name Penrose should be maintained because that is what the farm was called, and what the suburb was known as originally.

Councillors will discuss the name change and vote whether to engage the community about a new name for Penrose at tonight's meeting.