An estimated 30 caravans are in a Wisbech car park.
Police say the group is believed to be staying at the Chapel Road car park until Friday when they are thought to be moving onto the Appleby Fair.
The group arrived on Monday.
A police spokesman said: “We are working with Fenland District Council to ensure there is no breach of the peace.”
The council is monitoring the situation.
A spokesman said: “We were alerted to the encampment on Monday evening and have been attempting to persuade the group to move on. We are also in regular contact with the police, who are continuing to monitor the situation closely.”