An Australia Day party featuring the Nazi flag has been slammed as "racist" and "ignorant".

The Kalgoorlie event attracted attention when images of the flag and a map of Australia complete with a swastika cut into the lawn were shared on social media with accompanying captions, "stay white Australia", and "happy victory day".

The "victory day" party was condemned by Goldfields-Esperance District Acting Superintendent Tony Colfer, who told ABC police were investigating the matter.

"We don't tolerate this kind of behaviour in our community," Superintendent Colfer said.

"These people need to have a serious think about what they're doing, because material like this hurts everybody."