Williams, 41, said she read about the issues in Nelson the week before she was due to take the role and wondered whether it would lead to concern at Raetihi. "I thought, 'oh here we go'."
But she said the event went without a murmur.
"Absolutely everybody loved it," she said. "Raetihi is totally different."
Williams has worked in early childcare in the town for 11 years and she said this gave her an advantage over the younger members of the crowd.
"I know them all by name, so I was calling to them in te reo and everything and they were, like, 'Santa knows my name!'
"I thoroughly enjoyed it and everybody else did as well."
Christmas Carnival organiser Lucy Conway said Raetihi has the perfect Santa.
Conway described Williams' performance as fantastic as she called to the children by their names, "multilingual, jolly, loved and loving".
Ruapehu District mayor Don Cameron he and his wife Phyl were there and heard not a word about Santa's ethnicity or gender.
He said he wasn't surprised no one took any issue with the stand-in Santa. "It's happened before, a Māori Santa isn't new to Raetihi, put it that way.
"The thing about Raetihi is more than 50 per cent of the population is Māori. They are currently going through the Treaty settlement process and there's a real sense of unity and pride coming through.
"Like any small town, they have their issues from time to time but there's a real sense of pulling together at the moment and there's a feeling that things are quickly starting to improve."
Cameron said he didn't know Aroha Williams personally but he knew of her.
"She's a real character all right.
"My wife and I belong to Rotary and we were selling raffle tickets," he said. "It really was a wonderful day."
One week earlier, the Nelson Christmas parade was embroiled in controversy after organisers hired Rob Herewini, who wore a Māori korowai, or cloak.
He later told Marae he could see people giving him "thumbs down" gestures and hear booing.
"As we were travelling down the street on the float, you could actually feel the shocked look on the faces of the people and a lot of those were Pākehā people," Herewini told Marae.
Nelson City Council staff and elected officials were reportedly subject to "significant" abuse after the parade from people who claimed Christmas had been ruined by the selection of a Hana Kōkō.
This week, a "Bring Maori Santa To Welly" group was set up on Facebook in an attempt to pressure Wellington City Council to recruit Herewini for the capital parade.
"The people of Wellington would like to extend a warm welcome to Māori Santa Hana Koko, to be the star of the show at Christmas. We welcome Santas from all walks of life, and we would like to show our appreciation. Show your support for this invitation by sharing this event. Kia kaha Hana Kōkō!"
By Wednesday morning, more than 4500 people had indicated they were interested and almost 800 said they would go if Hana Kōkō was there.
Meanwhile at Raetihi, there were stalls and people lining Seddon St to watch as shiny trucks, tractors and floats paraded up and down.
The new McIntosh Dance Company float won first prize, in the first year of the company's existence. Ruapehu District Council's float took second prize, with TCB Ski Board & Bike coming third.
One stall raised funds for snowboarder Tui Wikohika's attempt at the 2022 Beijing Winter Olympics. And Raetihi's volunteer fire brigade raised $450 toward sending a team of four to the Firefighter Sky Tower Stair Challenge in May next year.
