Residents from Bannatyne Lodge Care Home were among those to attend the event, hosted by Town Mayor Cllr Mary Cartwright.
They were joined by elderly residents from across Peterlee, alongside care home staff and council members.
Derek Unthank, who lives at Bannatyne Lodge Care Home, on Manor Way, said: “It was such a great afternoon. I really enjoyed having a dance.”
Fellow resident Monica Taylor added: “I thought it was wonderful. It’s not often we get tea served to us by the lady Mayor.”
The care home’s activities coordinator, Dawn Minto said: “It’s so kind of the Mayor to invite us to the New Year afternoon tea.
“It’s a highlight of our calendar in January. We’ve been coming to this event for 10 years and have brought many people over the years.
“Our residents thought it was a treat to be served by the town councillors, who were the waiters as well as the hosts.”