Disability workers at the Dapto Respite Centre held a half-hour stop-work rally on Thursday afternoon, amid concerns the centre is about to be closed by the NSW government.
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Public Service Association NSW assistant secretary Steve Turner said the Dapto centre was one of five respite centres across the state which were under review by the government.
Mr Turner said 10 disability workers could lose their jobs if the centre closed, while hundreds of parents and carers of children with a disability could lose their respite.
"This is the only seven-day-a-week, 24-hours-a-day centre-based respite service for children in the Illawarra," he said.
"There are concerns whether the families and carers of children with a disability - many with autism and behavioural disorders - will have ongoing access to local respite services if this centre is closed.
"Thirty children can be cared for at one time at the centre, so that amounts to hundreds of parents and carers who are able to access services each year."
Mr Turner said the centre gave families access to publicly provided respite from trained workers at a guaranteed price.
"It gives parents and carers a break once a month or so which allows them to get some rest so they are re-energised and ready to spend the rest of that month devoting themselves to the special needs of their child," he said.
Twice-monthly respite has made all the difference to Penrose parents Monique and David Headington and their 16-year-old daughter Keira, who has limited communication skills due to a chromosome deletion.
"She's able to have a fun time with like-minded friends ... and it's a chance for us to get our energy levels back up," Mrs Headington said.
"Keira has three siblings and it's also a chance for them to spend some quality time with mum and dad because when Keira is home she needs constant attention.
"I don't know what we'd do without that break - it's something you need to stay happy and relaxed and provide a calm environment for your children."
A spokesman for the Department of Family and Community Services said the department was working with the clients of Dapto Respite Centre to determine the services they needed.
The spokesman said no job losses were expected as part of the process which would see an investment in a range of "flexible respite options".
"[The department] is currently evaluating the services it has traditionally offered in Dapto in relation to the stated needs of the individuals in the area," he said.
"This will result in a more client-focused service delivery, to be offered in conjunction with the local NGO providers to create a potentially wider and more targeted range of choices for clients."
The spokesman said clients would receive respite "delivered in a way that they decide".