Richard Gray, 36, is accused of possessing an imitation firearm with intent to cause fear of violence near Heene and St Mary's Primary Schools in Worthing.
Mr Gray was charged on Thursday and pleaded not guilty on Saturday at Brighton Magistrates' Court.
The defendant, of Cortis Avenue, was remanded in custody and will appear at Hastings Magistrates' Court on 15 May.
He has also denied possessing of a knife in Victoria Park.
Police said a man reported being shown a firearm close to Victoria Park and Norfolk Street in Worthing, at 14.15 BST on Thursday.
A woman said she was shown a gun in a bag in Stoke Abbott Road at 21:10.

Angella Reid was the first woman and second African-American to serve in the position after a career in hospitality.
"She is no longer employed here at the White House. We left on very good terms and we wish her the very best," said spokeswoman Sarah Huckabee Sanders.
It is simply nothing more than the transition of staff, she added.
According to the White House Historical Association, the chief usher's role includes overseeing "construction, maintenance, remodelling, food, as well as the administrative, fiscal and personnel functions".
The Jamaican-born Ms Reid worked closely with the First Family and provided guidance on matters of furnishing, art, and decor, writes the Washington Post.
She told the paper she had no comment to make about her departure.
She was very close to the Obama family, the newspaper reports.
"It gives me a sense of awe," she told CNN in 2016, "the fact that slaves built this house and I now work in this house as a leader, something out of my wildest dreams."
Because the chief usher is not a political position, it is not compelled to change at the beginning of a new White House administration.
Most stay on the job for at least a decade, and one was in his position for more than 30 years. Ms Reid was only the ninth since the start of the 20th Century, and leaves after six years.

King's has been collaborating with Technische UniversitÃ¤t Dresden on a research initiative, known as Transcampus, since 2015.
But, according to Times Higher Education, an "offshore King's College Europe" is now on the cards.
King's College confirmed that it was discussing potential further collaborations with TU Dresden.
The two institutions already offer 10 joint professorships and several joint PhD programmes through Transcampus.
However, its dean, Prof Stefan Bornstein, has told Times Higher Education that plans for the new King's campus are already "in the process".
Prof Bornstein, who is director and chairman of TU Dresden's department of medicine and an honorary consultant in diabetes and endocrinology at King's, said the plan would allow King's to have a presence in Europe and maintain access to European research funding post-Brexit.
Likewise, he said, TU Dresden would benefit from increased ties to London, one of the "leading academic centres in the world".
Prof Bornstein said the new campus would hopefully run new undergraduate courses "linked to innovation and the needs of industry and society".
The aim would be to recruit leading scholars from around the world, he added.
Prof Bornstein said the Transcampus project had been envisaged before the EU referendum but admitted that it had become "a lot more interesting" since the vote.
"We cannot allow things that have developed for so many years in a positive way [to be] hampered by political decisions that actually nobody wanted," he said.
"It's a nice way to have a solution to get around this very stupid Brexit idea."
A number of UK universities are believed to be considering opening branch campuses in Europe after Brexit - though earlier this year Oxford University rejected reports that it was in talks to open a Paris campus.
Prof Bornstein said he would expect the Transcampus model to be replicated by other universities in the UK and Europe, but stressed that the key was a long history of collaboration between researchers at the two institutions.
In a statement, King's said the university valued the Transcampus initiative "which demonstrates the success of cross-national and institutional links".
"We will continue to work together in various fields on research and exchange and discuss potential further collaborations."
A man has denied brandishing a plastic gun and a knife near two schools.
[NEXT_CONCEPT]
The Trump administration has fired the White House chief usher, who is responsible for the management of the building and its staff.
[NEXT_CONCEPT]
King's College London could become the first British university to open a European campus since the referendum.