The Homelands concert, an afternoon of southern sounds, comprised Christchurch's Taos, Invercargill's Rythmonix and Queenstown's Pass The Sauce playing live in the band rotunda.
Wakatipu DJs Pops, Fat Eddie, K-Lab, Sceptic and Pelroy took over between sets.
Residents and visitors brought picnic blankets, couches, chairs and chilly bins to the free event.
Families with young children chilled out alongside young people, who either relaxed with friends, danced barefoot on the grass, played hacky sack or threw frisbees.
There were jugglers and street performers, and several people brought their dogs on leads.
Downtown liquor stores did a brisk business.
Queenstowners Natasha Rowe and Sarah Mitchinson were among the hundreds enjoying the end-of-summer vibe.
"It's all right.
It would have been better if it started on time, but liking the music, liking the atmosphere, it's good."
Miss Mitchinson said it was good to see local bands involved and Homelands gave them a chance to be heard.
The session was organised by Revolver, which later held an afterparty featuring Taos and Blackplanet.
Revolver shareholder Johno Stapleton said events like Homelands were too few.
"Queenstown is not fragmented socially.
Everyone knows each other and gets to know each other through social gatherings.
There . . . needs to be more free community events, and live music is even better in a nice environment.
It adds to the ambience," he said.
