Visitors from across the country poured into the outback New South Wales city of Broken Hill at the weekend, dressed in drag to celebrate the Australian film Priscilla, Queen of the Desert.

It was the inaugural Broken Heel festival, a tribute to the Australian film shot around Broken Hill 21 years ago.

The film, about two drag queens and a transsexual woman who travel through the outback in a bus called Priscilla, has been credited with bringing drag into the mainstream.

Broken Hill City Council hopes the event will become an annual fixture for the mining town, providing an economic boost to the state's far west.

That sentiment was shared by many of the attendees, who embraced the opportunity to dress up in drag and party on Friday and Saturday nights.

Emma Doyle, dressed in a purple jumpsuit, was visiting Broken Hill from Melbourne.

"It was [on my] bucket list," Ms Doyle said.

"After seeing the movie 21 years ago, I knew I just had to do it in the desert, and here we are."

There was a heavy police presence on the Friday and Saturday nights, but officers said there were no significant issues.

Broken Hill's mayor Wincen Cuy hopes the event could leverage off Sydney's Mardi Gras parade in future, becoming an international attraction.

"I had nine American travel agents out here earlier this year, they absolutely fell in love with the idea, they believe that they could get groups out here," Cr Cuy said.

"Come out for the Mardi Gras, and then venture out to Broken Hill to see Broken Heel."

As the city's economy becomes more dependent on tourism, Broken Heel publicists are hoping to cement the event as a regional attraction in the same vein as the Elvis festival in Parkes, or the ute muster in Deniliquin.

The event was organised by the city's Palace Hotel, which had a starring role in the Priscilla film.

The hotel's Selina La Rovere-Nagas said there's already interest from would-be guests for next year.

"We certainly have people ringing and saying, 'can I book a spot for next year?'"

"So that's always a nice indication that we have something that's really quite promising."

ABC broadcaster Peter Goers hosted a best-dressed parade in the town square on Saturday.

"People come here to discover different things, don't they, always.

"Be it ore, silver, or all of that, or maybe themselves."

Visitors say locals welcoming

Performers Philmah Bocks, Art Simone and Jemima Handful on stage at the Broken Heel festival. ( ABC Open (Jenia Ratcliffe) )

Broken Hill's had to balance its tough reputation as a mining town with its status as a gay and lesbian icon thanks to its role in the film.

But performers and tourists travelling from across the country say they received a warm welcome from the city's residents.

"They've really embraced it, and I love that this city has this legacy now that it's a town famous for drag," performer Philmah Bocks said.

"I was walking past and someone screamed out of a car, 'happy birthday Priscilla,'" fellow performer Art Simone said.

"It was fabulous, they're very accommodating."

Director wants to "move on"

Performer Jemima Handful on stage at the Broken Heel festival in outback New South Wales.

But the man who directed the Priscilla movie in 1994 said he hopes Broken Heel will be the last time he'll publicly talk about the movie.

Ahead of the festival, Stephan Elliott said after two decades of being asked about the movie, it's time for him to give it a rest.

"I've actually decided it will be the last time I ever talk about the film," Mr Elliott said.

"It's been 21 years now, it's 21 years of talking about it, and it's going to be a big cake, and at the same time it's going to be blowing out the candles.

"A little part of me needs to move on a little bit, and I think I need to put the old bus and chain to bed."