The X-rated chocolates -- which also came in the form of men's privates and a couple having sex -- were handed out to youngsters at a Mother's Day event at the school, The Sun reported.
Cassandra Lacey, a mother of two kids, said: "Every single chocolate was to do with sex. This was in the school hall, on the school grounds and in school time."
An unnamed grandmother felt disgusted as she said: "My nine-year-old grandson gave this zip-lock bag to me, put it in my lap and said to me, 'You've got a willy in there nanny'."
"Then I had a three-year-old sit down next to me and she said, 'Hey, what's this?' She had this brown chocolate shaped like a penis."
"I told her she better go and talk to her mother."
The saucy chocs should not have come as a surprise - they were handed out in transparent bags at a public school in Australia's Hunter Valley, north of Sydney.
But such openness did cause much consternation, and shock to the parents.