The holiday booking website Lastminute.com reports a 66 per cent increase in bookings for Eastbourne.
And hoteliers confirm record numbers of tourists, particularly those coming for short breaks.
Ian Brett, owner of the Victorian-themed Albert and Victoria Guest House in St Aubyns Road, said, "Visitors from this country are relating the cost of fuel to the nights they stay. In the past where they might have stayed for four or five nights now they are staying for three nights, which counteracts the extra cost of petrol they have to pay to come down."
But he said the fuel increases were putting people off higher air fares and pushing them towards coastal English resorts.
The overall picture is of a surge in visitors, with almost 500 nights in Eastbourne booked on the Visit Eastbourne website last month and 16,000 people more calling at the Tourist Information Centre from April to June this year compared to last year.
Chris Wade, warden of Bay View Caravan and Camping Park in Old Martello Road, Pevensey Bay, said, "The Euro is catching up to the pound and you are not really going to gain from going abroad. When the exchange rate starts to fluctuate you are going to feel the pinch and decide you might as well stay and spend your money here.
"If we could have summers as hot as abroad here I think you would find hardly anybody would go abroad. We have some of the most beautiful countryisde in the world."
He said the area needed more campsites to accommodate all the extra people.
Paul O' Donnell, manager of Travelodge, which is drawing people to the town with cut-price rooms, believed people were more environmentally aware and would avoid flying if they could.
A spokeswoman for Eastbourne Borough Council said, "Due to the credit crunch, holidaying in the UK is becoming increasingly popular and Eastbourne is definitely seeing more visitors this summer.
"The town's accommodation portfolio is looking better than ever, with plenty of recent investment offering even more choice for visitors looking for a short break this summer, from the opening of the Big Sleep Hotel offering designer décor on a budget, to the resort's first art hotel, the da Vinci and from Eastbourne's boutique Waterside Hotel through to the extensive refurbishment of the Cavendish.
"The surge in bookings is a great boost to the town and local economy."
Tourism brings £173 million into Eastbourne each year, of which £115 million relates to accommodation.