The billboard, which would be installed on top of the WellWays building at 53 Humffray Street, on the north-west corner, would feature a 12.5 square metre side, facing east along Mair Street, and a south-facing 3sqm side.

Planning documents submitted to council note the billboard would be placed in a commercial zone, with no heritage overlays, on a single storey building.

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The documents include a letter of support from Regional Roads Victoria, stating it "would not object to this proposal, providing the measures... are adhered to", and a checklist of requests including the type, colour, and movement of billboard content, and sight lines for drivers.

"The proposed sign is to be located on the rooftop of the existing building, so will have no impact on any views for drivers," the planning document states.

"VicRoads have already cleared the proposed sign in relation to any issues with the nearby traffic lights."

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However, one man said the entire point of a billboard is to attract drivers' attention.

Stuart Kelly was in a road accident when he lived in Kew which he alleges was caused by a driver distracted by an electronic billboard.

"Driving through Kew Junction, there's a number of them," he said.

"I stopped for the lights, the bloke behind me didn't - if the change of sign takes place at the same time as the change of lights, the likelihood is your eye will be distracted."

A member of Ballarat Heritage Watch, Mr Kelly added he was disappointed that large billboards were appearing in the CBD.

"If a business wants to add a sign for its own business, that's fine, but for a set to advertise a car or whatever, for me it seems to be an unnecessary thing," he said.

"The Ballarat planning scheme specifically comments about having signs that detract from, or are above the buildings."

The applicant, Regional Billboard Co., chose the Mair Street site because it was not in a heritage zone.

Managing director Luke Course said he actually agreed about Ballarat's streetscape.

"There's a lot of Ballarat Central that is historically significant and has heritage overlays - (on Sturt Street), that's the middle of town with a lot of historically significant buildings, and it's strong in people's minds when they think about Ballarat, and I think people don't want that interrupted by a digital billboard," he said.

"When we selected this location, we thought it was a good overlap, there's good traffic for it to stack up for us commercially, and it's one of very few locations within the town centre that doesn't have heritage overlay.

"It's a pretty robust commercial area."

He added there was often a misperception about billboards in regional towns.

"When people think about billboards, they think about freeways in Melbourne or big parts in regional centres where 80-90 per cent is big national businesses, but that's something we have to educate people on - about 75 per cent of our advertisers are local businesses from within 10 kilometres," he said.

"We had one site in Traralgon, and for eight months it was 80 per cent local businesses.

"Once we put stuff up, people see it's primarily local business, most people don't have an issue with local businesses trying to grow their advertisers."

The City of Ballarat's infrastructure and environment director Terry Demeo said council "does not have a specific policy on electronic billboards".

"Given that there are many differing scenarios, in terms of zones and overlays, including the differences within each Heritage Precinct, our current preference is to consider the merits of each application under the provisions of the Ballarat Planning Scheme," he said in a statement.

"At present only one electronic billboard has been approved in the central business district."

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