Footage circulating on social media shows dozens of young people cramped together at the party, which locals say continued until after 3am.
Clare County Council has urged members of the public to act responsibly, saying last night's scenes "must not" happen again tonight, in Kilkee or elsewhere.
Councillor Cillian Murphy told Clare FM that he has never seen anything like it in 30 years living in the town.
If you are in Kilkee, the parents of a teenager and didn’t know where they were last night, then this post is for you. pic.twitter.com/j80IHXilFJ
— Cllr. Cillian Murphy (@Tri2bResponsibl) August 2, 2020
"All of this behaviour would be unacceptable at the best of times but it really is truly shocking in light of the Covid-19 pandemic. It's no surprise when we see images like we saw last night, why we are seeing the majority of new Covid cases are in this under-25 age group."