Oxford authors and their children gathered for a garden party to launch ambitious plans for a story museum costing up to £20m.

Philip Pullman and illustrators Ted Dewan and Korky Paul were joined by other leading literary lights at the Oxford Union on Saturday (June 25) to hear details of the proposals.

Poet and storyteller Michael Rosen got the event off to a good start by regaling youngsters with humorous anecdotes about his own childhood.

He said afterwards: "One of the reasons people come to Oxford is because of children's books.

"They come to search for Alice, the Hobbit, or Lyra's Oxford, but when they get here, they don't quite know where to go and a story museum would be perfect for that."

A board of trustees has now been established to raise funds for the project over the next five years. It is estimated that the museum would cost between £4m and £20m.

The trustees, who include children's publisher David Fickling and Robert Hutchison, of Oxford Inspires, hope the museum could be located somewhere near Oxford railway station, or elsewhere in the west end, where other major developments are being planned.

The "unconventional" museum would have spaces for children to read, listen to storytellers and actors, learn about books and authors and interact with permanent and temporary exhibitions.

It is hoped the museum would mix historical collections with cutting edge technology to create an attraction based on some of Oxford's best-loved children's books. Trustees of The Story Museum, a not-for-profit company and charity, have identified more than 100 children's authors and illustrators with local connections, from CS Lewis to Shirley Hughes, and will exchange ideas with staff from similar museums such as Seven Stories in Newcastle and the recently-opened Roald Dahl museum in Great Missenden.

Mr Pullman, best known for the His Dark Materials trilogy, said Oxford was the ideal location for the museum.

A patron of the project together with Jacqueline Wilson, children's laureate, he added: "The city is saturated with fantasy; the imagination has shaped every gargoyle that gazes down.

"A museum especially devoted to story will be a wonderful gift from Oxford, where so many stories have begun, to the whole world."

Kim Pickin, creative consultant for The Story Museum, described the proposal as an ambitious long-term dream.

"The dream can come true if lots of people believe in it," she added.

"We want to encourage children to listen to stories and make up their own because that can boost creativity and confidence."

North Oxford city councillor Jim Campbell said the museum would happen sooner rather than later if it received sufficient financial backing, including some "seven-figures sums from the United States".

While the money is being raised for a permanent base, organisers of the project plan to coordinate story-telling events for children through the Internet.

The website www.storymuseum.org.uk is being launched and in August, a programme of events will be staged for children at the Old Fire Station in George Street.