Nelson City Council says it's "not ideal" that sheep faeces were found next to a dam but the risk of faecal contamination in the town's water supply is low.
Sheep faeces were found by a member of the public along the edge of Nelson's Matai Dam, which is part of the town's water supply, last week.
Photographs show the droppings were close to or in the water, but the Council says while it's "not ideal", the matter has been dealt with.
Nelson City Council group manager for infrastructure Alec Louverdis said a gate had been left open in the area where the photographs were taken, allowing sheep to enter it and graze. The area has now been cleaned up and the Council has taken steps to prevent similar incidents from happening again.
"There is a low risk of faecal contamination in Nelson's water supply due to all potable water passing through Nelson's water treatment plant," Mr Louverdis said.
"The plant has several treatment barriers, including microfiltration and chlorination. Nelson City Council tests its water reticulation for pathogens including E.coli (the indicator species for faecal contamination) very frequently, and chlorination levels are checked and maintained 24 hours a day, seven days a week," Mr Louverdis said.
"While this incident is not ideal, Nelson's state of the art water treatment plant and rigorous reticulation testing ensures the city's drinking water supply is safe to drink."
Nelson's water quality was given an A grade for source and treatment at is most recent assessment from the Ministry of Health.