Teacher Mark Duckworth, 42, said Loretta Diplacido, 54, turned on his family after they politely refused to let her grandson use the trampoline in their garden.
Mark and his wife Sarah claim it sparked years of abuse, with Diplacido filming their kids in the garden and threatening to report them to social services.
The family claim she blocked their car in with hers, swore at them, threatened to attack them and spat at them in their own driveway.
Mark said his wife Sarah, 39, daughter Evelyn, seven, son Rupert, five, and his mother-in-law Azadeh Kent, 63, were terrified to leave their home.
They said they reported Diplacido to the police 70 TIMES - and installed CCTV which captured her grabbing Mrs Kent in the street.
She was finally arrested when Mrs Kent filmed the nightmare neighbour pouring tea over her, before mocking her and chasing her into her house.
Diplacido was sentenced last month for common assault at Leeds Magistrates Court after the family handed their video evidence to the police.
Now she's back living next door to the family, who think she should be evicted from her council house.
Mr Duckworth, 42, from Leeds, West Yorks, said: “She made our life hell. We dreaded walking out of the front door.
"She even drove my wife to the point that she wanted to move.
"Every time we went out the house or were returning - every single time - we felt anxiety.
"It really played on our mind all the time.
Mr Duckworth and wife Sarah, a children’s entertainer, moved into a their two-bed house 13 years ago, around the same time Diplacido moved into the home next door.
He said that his family steered clear of Diplacido but an altercation over a trampoline in June 2016 triggered two years of abuse.
He said: “We think it was because her daughter asked if her little son could go on our trampoline.
“We said no because we knew the family had no boundaries.
"We politely declined.
"Two weeks later, someone from the council came around telling us there had been a complaint about us parking on the grassy verge on the street, and it went from there.”
The abuse continued with parking being a bone of contention, they claim.
Mr Duckworth said: “We live on a very tightly packed road and sometimes we have to park in front of her house. That seemed to really annoy her.
“She blocked our driveway with her car and shouted at us when we entered the house, she even shouted at our kids.
“We found a nappy in our recycling bin and we knew that it was her. She would stand at the top of our drive with her arms crossed, looking menacing.
“She would scream at my wife and even shouted death threats to us saying she was going to ‘knock my head off’.”
The couple again contacted the police and were told to purchase cameras, so they spent Â£260 on CCTV.
But they claim she then turned her focus to Mrs Kent, 63, who recently moved in with her daughter and son-in-law and looks after her grandchildren.
Describing an incident they caught on CCTV, Mr Duckworth said: “Loretta boxed my mother-in-law in with two cars in September 2017.
"As Azadeh was taking a picture, Loretta rushed out in her dressing gown and confronted her.
“She was aggressive and standing far too close to Azadeh. She grabbed her finger and twisted it and caused permanent tissue damage to her finger."
The incident was caught on the Duckworths’ CCTV cameras and it was handed to the police.
But in May 2018, Diplacido struck again and was caught pouring a hot mug of tea over Mrs Kent before mocking her and chasing her into her home.
In the disturbing footage she got on her phone, Diplacido can be heard mocking Mrs Kent as she tries to hurry away.
She says: “Oh dear I’m very sorry, I’ve spilled my drink, so sorry love,” as Mrs Kent can be heard to breathing heavily and running into her home.
The police were called and Diplacido spent 24 hours in a cell and was banned from her property for six weeks ahead of the court case, they claim.
In August, she was handed a 12-month Community Order for common assault contrary to section 39 of the Criminal Justice Act 1988 against Mrs Kent, on May 8.
Mr Duckworth said: “It is still a struggle living next door to Loretta and we don’t understand why Leeds City Council will not evict her after all that harrassment and an assault.
“Are all tenants in Leeds free to get away with the same? There must be hundreds if not thousands of people across the country quietly experiencing harassment and abuse like us making their lives a silent hell.
“It seems the police can’t do much about it. Even with all our evidence, nothing came out of it until someone got hurt.
“I feel deeply saddened for those families out there who will be suffering like this with no end in sight.”
A Leeds City Council spokesperson said: "It wouldn’t be appropriate for us to comment on an ongoing issue."