The DREAM (Dubbo Regional Entertainment Arts and Music) Festival started in 2010 as a way to showcase the city's creative community.

However in 2020 the event, which had been run by volunteers, was handed over to Dubbo Regional Council. The volunteer committee said they no longer had the capability to run the growing festival.

At that time, about 20,000 people were believed to attend each year.

Now the council has said it does not have the capacity to run the event either.

Council's manager of regional events Linda Christof said the 10-day 2023 DREAM Festival was an intensive undertaking, too big for the organisation.

"The greatest challenge for council is that under the current structure we are not resourced for event delivery," she said.

"It meant that two staff members from the events unit were diverted from their roles for seven months... to ensure that as many individuals and organisations from our arts and cultural segment were invited to participate in the event."

Ms Christof said the DREAM Festival was delivered at the expense of strategic support for local events.

Returning the festival to a volunteer organisation was supported by the majority of councillors at Thursday night's council committee meetings.

But the final decision will not be made until the full council meeting on March 21.

Councillor Shibli Chowdhury championed the return of the festival to a volunteer organisation rather than ending it altogether.

Under his motion, the council will provide $40,000 towards the DREAM Festival, and support for the group or groups chosen to run it.

He said DREAM was such a big event it would be a "great loss for our community" if it ended.

Creative Assembly central NSW (CrACN) secretary Kellie Jenner is also pushing for the festival to continue.

"If council and community work together we can find a way forward and keep the DREAM alive," she said.

Ms Jenner highlighted the council's own figures which stated the 5000 overnight visitors and 17,000 people from outside Dubbo who attended DREAM injected $5.5 million into the city's economy.