The loss of the festival, which at its peak drew 10,000 people to Lydiard St on an otherwise quiet February weekend, will impact CBD traders, hospitality and accommodation providers already reeling from other event losses including the Lost Trades Fair and the Australian Jazz Convention.

Festival organisers blamed a lack of sponsorship and support for the financial issues that led to the axing of the festival, which was announced on Facebook late Wednesday.

But previous festival participants Lana-Rose Events, who hosted the popular Ballarat Pin Up competition, quickly stepped in to the newly vacant February dates to announce they would host a three-day event at the Ballarat Mining Exchange.

"We've got a very exciting event coming up that same weekend in the Mining Exchange, which we will transform in to the Flamingo Room and run the Ballarat Pin Up competition," said Tracey Spencer from Lana-Rose Events.

"On the Friday night we'll host a huge tiki party where everyone can dress up and be introduced to all the Pin Up entrants and there will be competitions, games, music and dancing," she said.

"Then on Saturday we'll host the normal fashion events and pin up competition, and in the evening change the room for a jungle party with various stallholders, and on the Sunday we'll have a general fashion event, workshops and a 'last drinks' event."

Ms Spencer said after the cancellation of the Ballarat Beat Rockabilly Festival was announced she had received messages from regular visitors to the festival who were going to cancel their travel plans, so they were forced to release details of their event "a bit earlier than planned".

"People just love it. It's so colourful and positive and voyeuristic. It's just a wonderful event with wonderful people. Rockabilly gives you freedom; you can do what you want, dress how you want and it's good clean fun."

The Ballarat Beat Rockabilly Festival had been running for about eight years, bringing about $1 million of economic benefit to the city each year.

Over the years the City of Ballarat had provided tourism event grants to the festival, the last of which was $15,000 for the 2018 festival - $10,000 less than what festival organisers originally requested.

Ballarat Beat Rockabilly Festival organiser Mark Browning said the decision to axe the 2020 festival was a "purely financial decision".

"We just couldn't take on the festival as it was without the kind of funding we had enjoyed previously," he said.

But the decision was a much more personal one than just money for Mr Browning, whose father Gary Browning, the well-known owner of The George hotel, had taken the festival from its early days to become a major event for the city.

"My father, before he passed away, asked me to make sure the festival continued because it was good for Ballarat and for the people who get to come, and for local businesses. He was thinking of all the hospitality, the accommodation, food and beverage for the weekend ... and it was a huge weekend," he said.

Mr Browning indicated he would support any moves to keep the rockabilly festival running in Ballarat.

"We have had phone calls from different people showing support and attempting to try to bring the festival back. In that case we would likely choose someone to hand the festival over to to make sure it runs correctly," he said.

Mr Browning said where support had previously come from council and local tourism authorities, he could not understand why funding had dried up.

"I haven't heard much from council. I only heard they were willing to support other possible events which is confusing because the one everyone wanted to come to was a success," he said.

In a statement, the City of Ballarat said it was disappointed at the cancellation of the festival, but was working with organisers to ensure a similar event continued in 2020.

Knowing the event was at risk, council staff had recently been working with two event organisers in the hope they could join forces with The George Hotel to offer additional support.

"We have supported the Ballarat Beat Rockabilly Festival since its inception and are keen to safeguard Ballarat's rockabilly tradition," they wrote in a statement.

"We appreciate the workload and cost of hosting such a large public event and thank The George Hotel and organisers for their efforts.

"This is a private enterprise decision which is out of our control and council will continue to provide appropriate support."

Mr Browning said he supported the Lana Rose team with their plans for next year, as she had been a big part of previous festivals.

"She was a huge part of the festival with her clothing, everything she does, the Pin Up festival which was one of the major drawcards," he said.

"The festival is a lot bigger than just one part of it; it's multi faceted with five or six different with five or six parts.

"All I want to do is see things be successful so all the businesses and people who enjoy the event do not miss out."

Mr Browning said it cost about $150,000 a year to put on the festival.

The Forge owner Tim Matthews said the hospitality, accommodation and other business sectors of Ballarat enjoyed the flow on effect of various festivals in town.

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"These types of events do impact a lot. We are happy to see if one event was to change or move, we'd definitely like that space to be filled," he said.

"There's a lot of spill-on effects that are not directly related to the event but really make a difference to the vibrancy of the town."

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