The proposed track will follow the lakeside for 3km from the Waihola domain to Surrey Bay, and fulfil an 18-year vision of the group behind the project - Waihola Looking Forward.
Chairman Stu Michelle said a painting of the proposed track looking from the domain towards Surrey Bay was revealed at its annual meeting last month.
''It's always been our vision to have a cycle track around the lake.''
Painted by local man Kevin Dalton, the image was a good interpretation of the group's plans, Mr Michelle said.
The project was in its very early stages and no cost estimates had been made. The group is consulting the Otago Regional Council and KiwiRail about viability of the project.
Mr Michelle said one option was for KiwiRail to drop more rock along the lake's edge in order to form a base for the track, while a more expensive option was to build a boardwalk.
The track would be similar to the cycle trails in Central Otago, and be at least 2.4m wide.
The Lake Waihola Waipori Wetlands Society had already sprayed old willows along the lake's edge and planted natives to beautify the area.
Formed 18 years ago, and now with about 20 members, Waihola Looking Forward revamped the community hall several years ago and had ongoing projects around the township, he said.
The Waihola Playground Trust's proposed ''destination playground'' at the domain would complement the walkway.
A pirate ship would feature in the new playground, and older dated equipment would be replaced, with the aim of attracting families to visit.
