"Fraser Island would continue as the primary name however the alternative names would recognise the island's indigenous heritage," he said.
The department is seeking public comment before March 11.
Butchulla elder Malcolm Burns said people should be asked whether they wanted the island to be named after Dreamtime princess k'gari (pronounced gurri), which means "paradise", or after Eliza Fraser, whom he branded a liar for saying the Aborigines who helped her survive on the island after being shipwrecked had degraded her.
"I've spoken to a few people – they'd rather be called a princess," Mr Burns said.
Mr Hart said the proposal also provided alternative names for eight geographical features including the Valley of the Giants, famous for its enormous tallowwoods which were some of the largest living trees on Fraser.
"The proposed alternative name for Valley of the Giants would be Ti, derived from an Aboriginal word in the Badtjala language meaning tallowwood tree," he said.
Four geographical features, seven localities and 41 sand blows would also be named under the proposal.
Among the sand blows to be named are Flinders Sand Blow, where Matthew Flinders reportedly landed on the island in 1802, Ganay Sand Blow, derived from the Butchulla word meaning "long heavy spear made from split hardwood", and Wul'lan Sand Blow, derived from the Badtjala language meaning pretty-faced wallaby.
Queensland place name plan QPN1037 showing the location of the unnamed geographical features and places on Fraser Island can be inspected at DERM's office at 120 Lennox Street in Maryborough, Fraser Coast Regional Council offices at 77 Tavistock Street in Torquay and 431-433 Kent Street in Maryborough and at the Queensland Parks and Wildlife Service visitor information centres at Eurong and Dundubara on the island
Copies of the proposal can also be downloaded from Queensland place names at www.derm.qld.gov.au
Written submissions on the proposal can be forwarded to the Regional Services Director, South East Region, DERM, PO Box 573, Nambour, 4560