Asbestos has been found in the water supply of the South Canterbury town, Temuka, but the district council says expert medical advice is that the water is safe to drink.
The Timaru District Council said testing found asbestos in the town water supply yesterday.
The area's medical health officer, Daniel Williams, said asbestos cement pipes were often used for water in the past, so it was not uncommon for there to be some asbestos in tap water.
He said asbestos was hazardous when it was dry and inhaled but the presence of the fibres in drinking water did not pose a hazard for people.
The district's mayor, Damon Odey, said it was not a desirable situation and the council wanted to resolve the problem as quickly as possible.
Mr Odey said the council had identified the pipe most likely responsible and was bringing in specialist detection services to check it.
The council says it is working to completely flush out the system and investigations of the water system are ongoing.