The event will be held on Saturday, the same day as Lancing’s Christmas market, and volunteers hope it will bring the community together.
A host of schools have got involved as pupils create lanterns for the parade.
Those taking part include Seaside Primary, Globe Primary, North Lancing Primary and Sompting Village Primary.
Creative director Andrea Ballance said: “Where we have been rich is in love and help.
“So many people have given up their time for us, making bunting and all sorts.
“We have everyone in the local area dropping off empty milk bottles, two litre bottles and tinsel.
“We have pulled together everything we need for an amazing evening for the kids.”
Santa Claus will be making an appearance in the parade and Minnie Mouse will be there carrying her lantern.
There will be buckets and spades, seagulls, beach huts, boats, smugglers, pirates and monster lanterns.
Also making an appearance will be Celebration Samba by the NCT band and the Worthing town crier.
Students from Northbrook designed all the publicity and have also made the section banners.
Lantern packs are for sale in the local Pet Supplies, Culver Road, and ESY shop, North Road, Lancing.
The event has been funded by left over cash from last year, the Adur pot of gold, £200 from Lancing Parish Council and other smaller donations.
Andrea continued: “We are expecting over 1,400 people this year.
“This really will be no ordinary night because so many people have pulled together to make it happen.”
A creation morning will be held in the Methodist halls in Lancing, 10am to 12pm, on Saturday, to create lanterns in the theme of smugglers and sea monsters.
The procession will start from Monks Recreation Ground at 3pm. Come dressed up and carry your lanterns.