The owners of a campsite home to a waterfall where a three-year-old girl and her father said there are signs warning visitors to stay on the paths.
The pair fell 50ft (15m) into a pool at the Nantcol waterfall at Llanbedr, near Harlech, on Saturday.
Despite the efforts of police, fire and ambulance crews, and two volunteer divers, their bodies were later found in the water.
North Wales Police has launched a joint inquiry with Gwynedd council.
The man and girl are from the Manchester area and were staying at the nearby Shell Island campsite with members of their extended family.
Alun Morgan Jones, the owner of Nantcol, said the paths to the waterfall had been open to the public for almost 40 years.
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In that time, he said there had never been an incident more serious than a broken ankle.
"At around four o'clock we were notified that someone had fallen in to the waterfalls," he explained.
"We rushed over thinking it was possibly someone a bit wet. On seeing where they went in to the waterfalls it was obvious that it was pretty serious."
He said signs leading from the campsite to the waterfall were clearly marked with warnings for members of the public to stay on the footpaths.
"We do stress by notices that it is a dangerous area and that people should keep on the footpath at all times," said the owner.
He said it appeared that the pair may have "veered" off one of those paths, before falling in to the water.
 |  It was awful. I saw the panic. We all went down looking, and there was nothing there  Eyewitness Andrew Partington |
But he added: "I don't know what happened and I'm waiting for the police to report.
"It is horrible, shocking and very upsetting for everybody."
Eyewitness, Andrew Partington, who was staying on camping grounds at the waterfalls, said he saw "frantic" efforts by family members to try and find the fallen duo.
"I saw a woman and some blokes running around looking for the kid. They said they had fallen off the top of the cliff in to the water, and they couldn't find them.
"It was awful. I saw the panic. We all went down looking, and there was nothing there.
"It was proper sad. The mother was there, she wouldn't go. The family were there looking for them, they were frantic."
Tragic accident
North Wales Police said the alarm was initially raised at just after 1600 BST on Saturday.
Along with a response from the emergency services, two local divers helped in the search for the missing two.
"All I could think about was the little girl and getting her back safely," said one diver, James Hordley.
"Things moved very fast but sadly we couldn't save them."
The two bodies were finally recovered from the waterfall pool two hours later.
Police are treating the incident as a tragic accident.
Paths to the waterfall were closed on Sunday, and the police investigations into the accident were continuing
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