DUNN St residents are gutted and angry after an appeal to stop a mosque being built in their street was thrown out of court.

The proposed mosque had been the target of intensive opposition from residents and from an anti-Islamic website that was investigated by Australian Federal Police after it called on supporters nationwide to oppose the mosque.

The website had been linked to a Cairns businessman who dubbed himself "Sheik YerMami" and called on supporters to "do whatever it takes" to oppose Islam and the building of the mosque.

Judge Keith Dodds yesterday dismissed the residents' appeal in the Planning and Environment Court against the mosque being built in the quiet North Cairns street. "We've all been let down and are terribly disillusioned," resident Bill Bradley said.

"We are not happy but that's the way it goes."

Mr Bradley was among a group of 12 residents who appealed against the former Cairns City Council's approval to demolish a house and build the purpose-built mosque opposite the Pioneer Cemetery and Kuranda rail line between low-set Queenslander-style houses.

At least one of the residents who appealed against the mosque's approval has already put his property on the market, with others considering a similar move.

Fellow residents Michael and Kathy Gelling said they were "disappointed" with the outcome, arguing the mosque would ruin the quaint streetscape.

Judge Dodds said the house, which was built in the 1950s and would be demolished, was not "an important part of the streetscape of Dunn St" and "to demolish it and replace it with a building which complements the character values of the character precinct will not diminish the precinct".

Recommendations for the construction of the prayer hall and kitchen facilities included fake windows and mature landscaping.

"There should be at least three of these hooded windows on each side of the prayer hall," the report said.

Mr Bradley said he feared the conditions would not be met, given conditions set in 2000 when the zoning of the land was changed to a church such as landscaping were never completed.

Far Northern Islamic leader Imam Abdul Aziz said he was pleased the case had finally been settled, after first being submitted to council early last year.

"We are very happy because basically we ended up with what we had before it went to court," Mr Aziz said.

"What every one has to realise is that everything we have planned is in accordance with the town plan."

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