The bonfire traditionally takes place at the Bundanoon Rebels Football Club (FC)'s home turf Ferndale Reserve, to bid farewell to the festivities in the town.

The event was moved from earlier this month to July 24 in the hopes restrictions would ease.

Bundanoon Rebels FC announced the cancellation on Wednesday morning.

"We thought it was a bit of a risk with what was developing in Goulburn, Sydney and Wollongong," said Bundanoon FC President Marty Gardner.

"We were disappointed because it was a good event for the village."

Organisers were hopeful the bonfire would go ahead after the opening night was cancelled last month due to Covid-19 restrictions.

Mr Gardner said RFS brigades were due to manage "the huge bonfire" and the crowd, and there was going to be music at the event.

Bundanoon Winterfest convenor James Fulford-Talbot said a lot of volunteers put in "lots of work" for the Winterfest and bonfire.

"It was upsetting knowing the impact that it has had on small businesses and over 3000 people who come to enjoy the opening night," he said.

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Mr Fulford-Talbot said despite the restrictions, some of the workshops scheduled throughout the month were able to safely go ahead.

"About 80 people were able to have a Winterfest experience, so that was a win," he said.

Locals gathered and learned felting techniques, crocheted tea cosies, made scented candles and learned about composting.

Young children also got in on the fun and made pizzas at the Bundanoon Hotel on July 8.

Online workshops on how to make gardens inviting for bees, how to add bushfire information onto the iNaturalist app, and the history of family heirlooms were also a success.

"You just take the victories where you can find them," Mr Fulford-Talbot said.

Mr Fulford-Talbot and Mr Gardner said they were hopeful to hold the event next year.

"Hopefully we can take lessons learned this year and use them to make next year easier," Mr Fulford-Talbot said.

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