The free festival, which starts today at 4pm and runs until 10pm, is the chance for locals to come together to celebrate the sights, sounds, flavours, artists and craft, and the richness of one of the Bay's most colourful communities.
Translated from Sanskrit, Diwali means abundant lights and is also known as the Festival of Lights.
The story behind Diwali is to honour ancient Vedic triumphs of divine beings over demons, most notably the victory of King Ramacandra over the evil King Ravana.
After 14 years of exile during which the victory over Ravana occurred, Ramacandra returned to his people in the ancient city of Ayodhya.
Diwali marks the anniversary of his reinstatement on the throne.
One Love Charity is behind the organisation, with German-born Bela and her Kiwi born-husband Dhruva being the main forces making the Diwali celebration happen.
Bela Reid said the Festival of Lights celebrated the victory of good over evil with song, dance, drama, colour, sumptuous feasting, and the exchange of traditional sweets.
Diwali is a free, family-focused event open to the wider community, she said.
About 1000 people were expected to attend including members of the Indian community from Katikati to Te Puke and a group from Auckland, including Sikh and Hindu devotees.
Reid said local school and dance groups would showcase their talents on stage and many of the Diya lamps on display were painted by about 600 local students.
"This ancient celebration is not only the chance for people to enjoy the fun, food, and entertainment but brings diverse communities together to help strengthen those bonds.
"No matter what your faith or cultural beliefs it's also the chance for people to dig a little deeper to find more about the richness of the Indian culture and its traditions."
Reid said the Historic Village was the perfect setting for the festival as their One Love Charity had ties with the Tauranga Multicultural Society and its members.
"My husband Dhruva and I have attended and participated in a number of Festivals of Lights in India and we would love to share our knowledge with other people."
Reid said the goal was for the festival to become an annual event at the Historic Village.
In March, One Love Charity put on the Holi Colour Splash event at Mount Maunganui, which will happen again in February at Jordan Park, Tauranga.