Dozens of residents attended a meeting to discuss the potential housing plans on Oakfield Recreation Ground.
Developers delivered letters to nearby homes on October 7, outlining plans to build 62 houses on Oakfield Recreation Ground in Bilton Road.
The area includes a number of trees, some children’s play equipment and a sports pitch.
The meeting was held at the Rugby Hotel on Wednesday evening and consultants were on hand to answer questions.
Many residents said they were concerned about increased congestion in the area, particularly during the school run.
A Rugby Borough Council spokesman said the Heart of England Co-operative owns the land and the council had leased it for around 30 years.
But the lease expired a year ago and the Co-op decided not to extend it.
Adrian Holloway, who lives near to the potential development site, said he strongly objected to the plans.
“I think it’s a joke to be perfectly honest,” he said.
“I’ve lived there for a few years and I know that the field is very well used.
“People walk their dogs, kids play there when the suns out, even kids going to and from school meet there and if the field isn’t there then they will be hanging around in the streets.
“All the schools in the area are full, you just can’t get any more kids in.
“So if 62 houses are built, where will the new children be educated?” he added.
John Brown, who walks his dog in the park, has started a petition which has collected more than 300 signatures so far.
“We need to stand up to this development,” he said.
“The petition has had a lot of support so far and it will continue to grow.
“We shouldn’t have to lose our only open space, there are other places in Rugby that can be used for housing,” he added.
A formal planning application has not yet been lodged.
Ali Kurji, chief executive of the Heart of England Co-operative Society, said: “As a community retailer, the society has a deep regard for its local community and greatly values local public opinion.
“The public consultation provided an opportunity for the public to air their views and all matters raised will be carefully considered.
“Subject to the consultation outcome and any subsequent planning application, it would be society’s intention to assist in the funding of alternative recreational facilities should the need arise.”
New Bilton borough councillors have arranged a public meeting to discuss residents’ concerns.
The meeting will be held at the Indian Centre, Edward Street, Rugby, on October 27 at 7pm.
For further details of the meeting email email@example.com
Residents have also started an online petition which can be found at https://you.38degrees.org.uk/petitions/say-no-to-bilton-road-development