Coastguards were alerted after a raft built like the Loch Ness monster, with kilted mannequins dressed in Scottish rugby shirts, went missing on a river.
The 25ft (7.6m) monster raft is to be the centrepiece of the Carmarthen River Festival in west Wales next month.
But it came away from its mooring on the River Towy after heavy rainfall.
Organisers were worried onlookers would think the six dummies were people in trouble. "Nessie" was found safe and well in mudflats five miles down river.
A search party discovered the raft lodged on the estuary mud on Saturday.
The team tried to recover the raft, which has a 6ft (1.8m) Loch Ness Monster head at one end and a tail at the other, at high tide.
Festival chairman Ian McCue said they believed the raft, which was built by a local group, was dislodged from its mooring in the town by a tree which had floated down the rain-swollen river on Friday night.
"It was quite embarrassing ringing the coastguard about this," said Mr McCue.
"I am the chairman of the local canoeing club so I ring them quite regularly to tell them where we are going.
"The coastguard I spoke to was in hysterics for about 10 minutes when I told him."
Mr McCue said that people in the town had told him the mannequins, which are dressed in Scottish rugby shirts, kilts and wear masks, looked very lifelike from around 25ft away.
"Anyone spotting it from a distance may have thought there were people in trouble on the raft," he said.
The Carmarthen River Festival was originally scheduled to take place from 8-9 July but was postponed due to the poor weather.
It will now take place on 11-12 August with attractions including coracle racing, zip wire rides, kayaking, sailing and walking the plank.
The 52-strong raft race between Whitemill and Carmarthen will be the main event in the festival, with around 300 local people taking part.