Mr Lancaster's typical stuffed possums usually sold for about $70. By last night, $251 had already been bid for the cat.
Mr Lancaster also had some more "unique" creations in his collection at his Kaimai's home - such as a possum-headed chicken with vampire teeth or a small bird with the head of a child's doll.
The UK expat said he did not know who bought his work or why but he enjoyed creating them, despite backlash such as "you sicko" or "hope this happens to you".
"I just respond with a smiley face."
Mr Lancaster upset animal lovers when a picture of a doll's face on the body of a possum last year went viral.
He said he expected the same issue this time but was pleasantly surprised at feedback, including comment from an ethical vegetarian referring to the cat as "amazing art".
Despite the creation, Mr Lancaster said he usually stayed away from working on pets like cats and dogs.
"It puts a lot of people's backs up. If someone has known their pet all their life, it's very hard to get it right when you work on them."
Eliot Pryor, from animal advocacy organisation SAFE, said the sale of the cat was "extremely bad taste".
"But there is also something distasteful about the attitude shown to an animal once it has died, as the description is light hearted and not respectful," he said.
-APN