The residents, some of whom have been living in the Ballan Caledonian Caravan Park for nearly 10 years, have been given six months to find a new place.

Helen Baker, 62, who has a disability and has been living in the park with her husband for more than five years, said she had nowhere to go.

"It's my home and I have an established garden," Ms Baker said. "I love it here."

She said she was worried about the future of her family and her two dogs.

"I am worried I am going to be homeless if they kick us out," she said.

Moorabool mayor Pat Griffin said he was concerned about what would happen to the park's residents.

"I don't know the residents' situation, but people live in a caravan park because it is low-cost housing," Cr Griffin said.

"There is no other caravan park in Ballan and the rental market is very tight."

Only one of the town's three real estate agents has rental properties available.

But the caravan park residents say at $200 or more, the rents are beyond their budgets.

Long-term resident Charlie Farrugia, 62, who lives at the park with his cat and two dogs, said most residents paid between $100 and $170.

"I have got pets and it's hard to get rentals," he said.

"I'm not letting go of my dogs for anybody."

DSE regional director Laurie Dwyer said the department had not been able to secure ongoing management for the park.

"In addition to the management issue, the permanent residential nature of the caravan park on Crown land is contrary to government policy, legislation and regulations," Mr Dwyer said.