The Waitaki District Council said it had no choice after being issued a coastal consent by the Otago Regional Council in 2007.
The district council revealed the number of people being asked to leave the breakwater after issuing a press statement this week as an "annual reminder" to stay out.
The main focus of the message was the financial risk this posed if the council was found to be not meeting the conditions.
Visitors to the Oamaru Blue Penguin Colony end of the breakwater are now greeted by a locking gate, while the adjoining Sandy Bay has security barriers with signs at the breakwater.
District council commercial and property lead Claire Foster said the Waitaki district spent $6000 on security firm callouts last summer to remove people from the breakwater.
"While we recognise that for some walking on the breakwater was an essential part of their child or adulthood, [the] council would like to encourage the community and visitors to find another spot to view korora or fur seals and avoid any further expense to the ratepayer."
Under the consent conditions no-one was permitted on the Oamaru Harbour breakwater at any time of year, but especially to view korora (blue penguins), Ms Foster said.
About 1200 people were found contravening the rules in the past year.
Ms Foster said the council had written to accommodation providers and had provided bilingual posters highlighting the prohibited areas.
It was "encouraging" people to view korora at the Oamaru Blue Penguin Colony "or at any of the other locations not covered by the coastal consent".
She said people flouting the conditions posed a risk of fines to the district council plus any costs of investigating non-compliance by the regional council.
The end of traditional access to the breakwater had upset many residents.
Penguin colony science and environmental manager Dr Philippa Agnew said they had seen people getting into potentially serious trouble on the breakwater.
Inevitably people were unaware of just how volatile the environment was including the risk of over-wash from rogue breakers, or encountering a sea lion.
People being spotted by colony staff were immediately reported to the district council.
