Here, dwarfs perform in fairytale costumes for tourists, drawing both curious crowds and a fair share of criticism.

For many of the employees, the park is a rare opportunity to find work, and – as unlikely as it seems for men and women doing daily spoof performances of Swan Lake in tutus – respect.

The park employs 108 dwarfs from across the country, who twice daily gather on an artificial hillside to dance and sing for tourists.

As well as a host of dwarf guardian angels, the fantasy world has a king, an army, a health department and even its own foreign ministry, and all must pretend to live in a miniature hilltop village of crooked little houses.

For the equivalent of £8 – not a small sum in China – tourists can watch sketches, sentimental group dances and acrobatics some may view as more than a little reminiscent of medieval freak shows.

The centrepiece of the show is a farcical rendition of Swan Lake, with both male and female performers dressed in pink tutus and pretending to be little swans.

"When I did it for the very first time, I felt a bit embarrassed. I had never worn a skirt like that before," said 21-year-old Chen Ruan, who left his native Hunan province to join the park when it opened last July. "But later, once I got used to it, performing it felt very natural."

Chen Ming, a flamboyant Sichuanese businessman who single-handedly conceived and funded the park, made his fortune in electronics and property, but he said he had always wanted to do good for society.

Having invested £10 million in the site, which nestles among nine forested peaks near Kunming city in Yunnan province, he is looking to further expand it.

While the venture is yet to make a profit, Mr Chen hopes the number of performers will grow to about 1,000 within a few years. One day, he beams, the navy will have its own reservoir, the infantry a railway, the air force a cable car and the foreign ministry staff will serve as tour guides.

"I'm very happy with it," he said. "What I need now is for some people, especially Europeans and Americans, to understand us.

"Because some people don't get it – they think we are using the dwarfs. But what we are actually doing is giving them a platform to live, giving them worth and the ability to work freely, to exist freely."

Not everyone is convinced. Disabled rights groups and members of China's increasingly vocal online community have suggested the park may only serve to increase stigma.

"We need to go and tell him how to respect disabled people's rights, how to help disabled people to develop in their own lives, and not to exploit people's curiosity for commercial success," said Xie Yan, director of Beijing's One Plus One Cultural Exchange Centre, which advocates more equality for disabled people.

One performer, Li Caixia, said it had been near impossible to find well-paid work after graduating from high school; she was tempted by the prospect of up to £200 a month, double what she might get working anywhere else. "As soon as employers see us, they know they definitely wouldn't want a small person like us. They have to pay the same salary, so they all want to find someone more normal," she said.

The only qualification for employees, whose ages range from 18 to 48, is to be shorter than 130cms (4ft 3in) and fundamentally self sufficient. They live in a dormitory designed to look like a cave.

Facilities from sinks to light switches are installed with people of short stature in mind, offering greater independence for employees, many of whom were once heavily reliant on parents or charitable institutions.