As first reported by The Express, the settled community in the Hovefields area of Wickford reported hardcore-laden lorries arrive at the weekend.
The lorries were followed by large mobile homes.
Basildon Council said it is aware of "an alleged breach of planning laws". Essex Police has also been informed.
The Hovefield site - which is subject to a High Court injunction preventing further development - is less than three miles (5km) by road - from the Dale Farm traveller site in Wickford.
Dale Farm was Europe's largest traveller site before about 80 families were evicted from unlawful plots in 2011.
Jill Walsh, of the Hovefields Residents Association, said an English Traveller family in five caravans left the site on Friday.
After they departed, she said, a number of large lorries carrying concrete, hardcore and three mobile homes drove down Hovefields Avenue and onto the five acre field at the end of the road.
Mrs Walsh said because of the narrowness of the road one of their neighbours - an elderly couple - had their fence ripped out and shrubbery damaged so that the lorries could get through.
"If the council does not prosecute over this and deal with the situation urgently they will have a Dale Farm II, but bigger."
Phil Turner, leader of Basildon Council, said: "Basildon Council is aware of an alleged breach of planning laws in the Hovefields area.
"We share the frustrations of residents, but the council does not have powers of arrest and must follow the proper legal process.
"As a public body, we must act within the existing legal framework, as set out by Parliament, and this adds considerable time and cost in dealing with such situations.
"However, residents can be assured that the council is taking all appropriate steps to deal with unauthorised development."
Essex Police said it was investigating a criminal damage report involving the fence and has urged any witnesses to contact them.
A police spokesman said: "Essex Police is aware of an unauthorised traveller development on land near Hovefields Avenue.
"We are liaising with the local authority and will continue to monitor the situation."
Residents have called for urgent action amid claims that a new mass Traveller site is being created at the end of their road in Essex.