East Riding councillors, who met on Monday, overturned officers' recommendation of approval by voting five to four to reject the plans.
The proposals would have seen eight touring caravan and eight tent pitches and six camping pods as well as an amenities building built on a field off Fisher Lane.
A local resident told the committee that Lissett was a sparsely populated hamlet with no amenities or street lights and was a "tranquil rural idyll".
There had been over 65 letters of objection and none of support and putting the campsite so close to homes was "not in keeping with the size and nature" of the settlement, she said.
She said the site would be "clearly visible from the A165 and will not be sensitively integrated into the landscape", reminding councillors that the Yorkshire Wolds had last week had become a candidate area of outstanding natural beauty.
Applicant Peter Goodwin told the committee he had lived with his family at Mount Farm for over seven years and there was little local provision for camping and caravanning.
He said: "We decided it would be great to open a new campsite that allowed people to enjoy the rural side of the East Riding."
He said after receiving feedback the plans were changed to ensure it would have a low impact on neighbours, including removing hot tubs and a lighting scheme. They would also put in two new passing places and had moved the field entrance away from a neighbour's entrance.
However ward councillor Jane Evison, who was not on the committee, said Lissett, which has around 27 properties, would be "totally overwhelmed" by 22 pitches.
She said there are many other sites available in the area "all with plenty of spaces", adding: "We are a tourist area but that must not be allowed to happen at all costs.
"Our countryside and residents' quality of life are an important consideration."
However Coun Barbara Jefferson wanted to know how the application was different to others recently approved by the committee, including at Mappleton and Bewholme, where similar concerns had been raised. The councillor had been unsuccessful in fending off applications there.
She said it had been "really quite uncomfortable" listening to the debate, adding: "It is just such a turn round in such a short (time)... Surely as councillors we have all got consciences haven't we."