More than 20 caravans have pitched up in a supermarket car park.
The travellers parked up in Sainsbury's West Hove, off Old Shoreham Road, led to police being called to the scene yesterday.
About a dozen caravans turned up initially, with more arriving later on yesterday.
A Sussex Police spokesman said they were in talks with the group to assess what their intentions were.
Yesterday he said: "It's still very early days yet and once we've established what they intend to do, we will look at our options."
Now police say they are working with the council to resolve the issue.
Dawn Barnett is one of the local Conservative councillors for Hangleton and Knoll ward as part of Brighton and Hove City Council.
She said: "They are completely taking over. It's not acceptable."
A spokeswoman for Sainsbury's said: "Our store is operating normally, with no disruption for our customers.
"We’re working with the police and other agencies to resolve the situation and will be taking proceedings to evict the travellers from the car park."
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