The improvements are Football Association requirements to enable the club to progress from the Peterborough League to the United Counties League.
The owner of the Knight Street field – Pinchbeck Parish Council – is a consultee on the plan lodged with South Holland District Council and voted unanimously against it on Monday.
East ward member John Allen said: “We are 100 per cent behind the club but this application is a conflict of interests with keeping the field as public open space.
“The club have been there for donkey’s years and we’re happy for them to remain but that field is public open space and really we want to keep it that way.
“The public currently has access to all of the field but once you fence off a part it’s taking that away.”
Coun Allen said the parish council has offered the club land in Langhole Drove and Northgate, but neither were deemed suitable.
He added: “The application was a bit of a surprise, really. They had not asked us first. They don’t need to do that but ultimately they are going to need the landowner’s permission.
“We would like to talk to them to find a solution.”
First-team manager Ian Dunn said the vote was a blow as his side hopes to win promotion this season.
“That’s been the aim and our form suggests we’re capable of doing it,” he added.
Club chairman Andrew Withers added: “We’re progressive and want to move forward for the benefit of everybody and the community.”
