The woman had been woken up by the sound of shouting and screaming outside and saw Jack Reid, who was rowing his partner.
Newcastle Crown Court heard the 53-year-old opened her window and shouted: "Leave her alone you bully".
Prosecutor Neil Pallister said she then went outside and could see the woman who Reid had been arguing with was crying and distressed.
During the incident in, Wallsend, North Tyneside, in September 2019, the woman again told Reid to leave his partner alone.
He then armed himself with a pistol, which turned out to be an air weapon.
The court heard the neighbour went back into her home and called the police.
Officers arrived a few minutes later and found the gun in a black case on a shelf in the front bedroom.
It had the appearance of a Colt M1911 pistol.
The neighbour, who had only ever spoken to Reid once before and who had no previous issues with him, said in a statement read to the court: "This incident left me feeling terrified and I no longer feel safe in my address.
"No one should be threatened with a gun."
Reid, 25, now of Garcia Drive, Ashington, Northumberland, pleaded guilty to possessing an imitation firearm and was sentenced to 10 months imprisonment, suspended for 12 months with 80 hours unpaid work and a rehabilitation requirement.
Judge Edward Bindloss said: "You became angry, told her to f*** off, went in the house, put an imitation firearm into the waistband of your trousers and came out.
"That was plainly intended to cause her fear."
Shaun Routledge, defending, said Reid has been promoted at work, is now in a management position and has moved away from the area.
He added: "He's looking to the future and won't be back in front of a court again."
The court heard the offence was out of character, he is remorseful and he has taken steps to make changes in his life.