Yet those donated items - which include a rocket launcher, grenades and mortar shells - on Thursday sparked a major operation involving army, police and the bomb disposal unit after it was discovered they were live explosives.

Lake Illawarra police were carrying out a licencing inspection of the closed Breakwater Battery Museum, located on Gloucester Boulevarde, when they assessed a collection of war artefacts about 8am.

Read more: 'Worst damage I've seen': Illegal trail bike riders vandalise Dapto football club's home turf

Wollongong Heritage Collection volunteers, who are planning on re-opening the museum, notified officers after finding about 25 explosives, which were likely donated many years ago, in a cabinet.

The collection included explosive projectiles used in a rocket launcher, hand grenades, mortar shells, live rounds and other ordnance.

Sergeant Gary Keevers called in the Illawarra Rescue and Bomb Disposal Unit who deemed the ammunition to be live, therefore Australian Defence Force bomb experts were asked to attend the scene.

"There was no criminality," he said. "The volunteers found the explosives, notified me during our inspection and we made sure the scene was safe.

"The ordnance will be taken away by the army to be destroyed or the volunteers can pay to have them certified as inert."

Sgt Keevers said the army's experts had deemed the artefacts would not have exploded if handled but could be used if they got into the wrong person's hands.

"The public were never in danger, and once the museum is up and running again it will be completely safe," he said.

Wollongong Heritage Collections president Terry Bugg said he was not sure how old the artefacts were or who had donated them, but planned to find out from the paperwork in the museum.

"I am quite happy with how the day played out," he said. "It was best to be on the safe side. We did the right thing by informing the police, who called in the ammunition experts.

"It was an exciting morning. We thought we would spend about half an hour with police doing an inspection and then the bomb unit, army and media came. It has brightened my day."

Mr Bugg was told some of the items found that were already inoperable would be handed back to the museum and it was likely the live items would be destroyed as the volunteers could not afford to have them certified.

He said the 15 volunteers hoped they would be able to open the museum in a couple of months, once police gave them the tick of approval.

"We still have to work on the displays to make sure they look good," Mr Bugg said. "It has been quite a struggle to get ready for opening. It has been a labour of love. I am interested in military history and enjoyed researching local people."

Mr Bugg said the newly-opened museum would have displays of local veterans who served in the wars, a life-size WWI trench, a jungle room like in Vietnam, a room designed like a Pacific Island as well as other artefacts such as badges, medals and ammunition.

We depend on subscription revenue to support our journalism. If you are able, please subscribe here. If you are already a subscriber, thank you for your support.