Two towns in Western Australia are at odds over which should have the right to display a 50-year-old yellow submarine.

Originally grey, the submarine was built at Dongara, 400 kilometres north of Perth, in 1968 — the same year the Beatles' Yellow Submarine hit movie screens.

Some say it was built to search for painted crayfish, while others speculate it was really constructed to look for lost treasure.

Dongara boat builder Chris Hicks was 16 when he was hired to work on the project.

"They told us it was designed to scoop the crays up with this vacuum cleaner, but maybe it was made for something else like treasures on sunken ships or something," he said.

"I'm sure there was some sort of scam going on there, because you did not get much crayfish then anyhow and painted crays were not that good — no-one here would eat them."

The submarine was originally painted grey. ( Supplied: John Rossiter )

Failed project turned icon

The sub was a collaboration between MG Kailis Fishing Group, Severn Graham & Bernard and Dawson & Clapp.

While built at Dongara, it was first submerged off Geraldton, however the project was soon abandoned after it was discovered the submarine's battery emissions were too severe.

Rather than going to scrap, it was painted yellow as an ode to the Beatles and displayed on Geraldton's foreshore, where years of salt and wind turned it to rust.

After a couple of years sitting in the local council depot yard, the sub is being given a new lease on life by the Rotary Club of Batavia Coast.

Club president Sue Svenson said it would be displayed at a roadhouse near the entrance of Geraldton by the end of the year.

"Currently, the submarine is looking very sad because we removed all the rusted areas and got it back to basics," she said.

"We are ready to start putting it back together again; we are a little bit slower than we had hoped with the project."

Despite turning to rust, the submarine is still occasionally paraded through the centre of Geraldton. ( ABC Midwest and Wheatbelt: Laura Meachim )

'Legally it is ours'

But Dongara local John Rossiter said the submarine should be displayed there.

"It belongs here, and as far as I am concerned, Geraldton got it by default," he said.

"Even in an unrenovated condition, I really feel we could get it back to here, and with the facilities we have here and the people we have, we could get it renovated for nil to council."

Mr Rossiter appears to have the support of the Dongara community.

ABC Midwest and Wheatbelt talkback caller Ivan said the town was always its original home.

"I am to understand that the submarine was actually sent to Geraldton for minor work to be done, maintenance work, so legally it is ours," he said.

"I would hate to see a small town being bullied by a larger city.

"I would love to see it come back to Dongara here and we could put it on the foreshore right alongside the Fisherman's Hall."

Chris Hicks says he wasn't too excited by the project at the time but earned good money working on it. ( Supplied: Chris Hicks )

'The horse has bolted'

But City of Greater Geraldton Mayor Shane Van Styn said the submarine would not leave Geraldton.

"The city has spoken with the family of the original builders of the submarine back in the day, and as far as they are concerned it is the city's to do with as they see fit," he said.

"There has been an extensive amount of expressions of interest and a call for what people wanted to do [with the submarine], I would say the horse has well and truly bolted in this case."

Mr Hicks said he would just like to see it repaired.

"It was made here, but I'm not worried whether it goes to Geraldton or comes here," he said.