Their fear is heightened by the belief that police are reluctant to protect them in general should verbal intimidation turn into violence, a report by The Jakarta Post said.
Merlyn Sofyan, a transgender activist, told the Post that transgender groups throughout Indonesia have reluctantly curtailed social events and educational classes in the past two years over such fears.
"Our situation has been relatively stagnant. The police have not been cooperative," she told the Post.
"They know that the Front threatens us but they make only small efforts," said Merlyn, the 2006 Miss Transgender Indonesia.
Yulianus Rettoblaut, chairwoman of the Indonesian Transgender Communication Forum, said the recent festival wasn't a beauty contest but a celebration of their identity.
Police witnessed the forcible intrusion of Front members but didn't help when 200 or so transgender people were harassed by dozens Front members, she said.
"The Front said that we had no permit for the event. In fact, we had sent letters requesting a permit to the Jakarta Police, the South Jakarta Police and the Setiabudi police precinct. But, they didn't respond," Yulianus said.
"Days before the festival, a police officer rang and ordered me to call off the show because the Front was planning to attack us," she said.
A report by the Jakarta Globe newspaper said Salim Alatas, head of the Jakarta chapter of the Front, acknowledged that his members went to shut down the event.
"The local community did not want the contest to be held in their area," Salim told the Globe.
He said transgender events are "morally destructive and not educational" and the Front will always oppose them where ever they are held.
The fundamentalist Islam Defenders Front was set up in Indonesia in 1998 by Saudi-educated Muhammad Rizieq Syihab and aims to establish Islamic Shariah as the law in the country.
Earlier this year police said they had recorded 34 cases of "violence or destructive behavior" by Front members across the country in 2010-2011, a report by the news website Kompas.com said.
A report by International Crisis Group said the Front is "an urban thug organization" noted "for its thuggish attacks on bars, brothels, and restaurants" as well as against groups it believes are deviant.
Indonesia has a Muslim majority but is officially a secular country.
In May U.S. pop star Lady Gaga canceled a Jakarta concert because of religious opposition, including that from the Front.
A report in The Jakarta Post at the time quoted Salim saying that Gaga brings "the faith of Satan to our country and thus will destroy the nation's morals."
Another front spokesman said Indonesian Christians should praise the Front as well as other Islamic organizations for opposing Gaga's concert.
"Lady Gaga has obviously misused symbols of Christianity, such as the cross, in her work," he said.
Last week, President Susilo Bambang Yudhoyono said he hoped that Christmas 2012 would be celebrated inclusively and enjoyed by all Indonesians who wish to participate, a report by Antara News Agency said.