Government agencies are investigating potentially contaminated water around the Ohakea and Woodbourne Air Force bases.
NZ Defence Force have found the levels of two compounds, which are no longer made in or imported into New Zealand, to be above normal guidelines in soil and water.
Government agencies are testing water at neighbouring properties around the Woodbourne base near Blenheim and the Ohakea base near palmerston North, to determine whether the chemicals have spread beyond the bases.
Health officials believe there is "no acute human risk", but it is "prudent" to test the drinking water, Environment Minister David Parker said.
The compounds PFOS and PFOA were found, which were historically used in specialised firefighting foam to fight and train for flammable liquid fires.
"Neither NZDF nor the Fire and Emergency Service routinely use foams containing these compounds any more," said Mr Parker. "However, we are talking to other organisations, whose firefighting activities may have used these compounds."
NZDF and Ministry of Health staff are contacting potentially affected properties and talking with residents.
Test results are expected in mid-January.
It comes the day after a damning report into New Zealand water quality was released.
It showed over 700,000 New Zealanders could be drinking water that is "not demonstrably safe".