William Tyrrell’s grandmother reveals fears he may have been taken by an 'odd' neighbour

As the inquest into missing toddler William Tyrrell continues, new evidence has come to light regarding what happened the day he disappeared.

His foster grandmother, one of the last people to see him alive, initially told police she had fears an “odd” neighbour may have taken him.

“I can't think of anyone who would want to harm William,” she told police in the statement, dated two days after the toddler disappeared.

“I was asked this question initially by Wendy Hudson (a policewoman who lives in Kendall) and I suggested Peter across the road, (as he keeps odd hours and lives alone),” the inquest document said.

The statement was tendered to the inquest on March 25 and released on Tuesday following an application to the Coroner's Court by Daily Mail Australia.

William’s foster grandmother added that her daughter had taken the famous last photos of William in his Spiderman suit on her balcony and had been thinking about giving him morning tea, and supposed it was about 10.30am.

“William lost interest in drawing pictures and rolling dice and he ran down the two small stairs of the back patio, onto the grass and he ran around the right-hand side of the house (to the front).

“That is the last time I saw William.”

William’s foster mother then said she felt William had gone a bit quiet and went off to look for him.

When she couldn’t find him, William’s foster mum called the police and William’s foster father.

Investigators have ruled out William's biological and foster parents having any involvement in his disappearance.