The outdoor museum will be transformed for its Winter Wonderlights event which attracted more than 95,000 visitors last year.

The special European-style Christmas event will feature activities during the day and into the evening as the sun sets.

Sovereign Hill director of marketing Jennifer Ganske said the Winter Wonderlights show would delight people from across world.

"Each year, we strive to deliver a highly innovative event that bring enormous economic benefit to the city of Ballarat," Ms Ganske said.

"Winter Wonderlights transforms Sovereign Hill and delights people from all across the globe and we are excited for visitors to see what we have in store for them this year."

Theatre performances, arts and crafts, a cheeky gingerbread man, faux snow, European market and flames erupting from the Sovereign Hill chimney will entertain visitors.

At night, there will be more than 15 kilometres of fairy lights, including a new light tunnel, live music and a new light projection show.

More than 25 buildings will come alive with large-scale light projections, the largest light projection spectacle ever staged in one site anywhere in Australia.

Christmas in July: Winter Wonderlights will be held at Sovereign Hill from Saturday, June 29 until Sunday, July 21.

Ticket cost $62.00 adults, $27.80 (children 5-15), $49.70 (concession), $157.00 (family) and $112.00 (single family).

Visitors wishing to experience Winter Wonderlights can also book tickets to Sovereign Hill's new sound and light show Aura, which will run each evening after Winter Wonderlights.

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