Hatepe's water supply has been shut down as a precautionary measure following the confirmation of potentially toxic algae in Lake Taupo.

The decision was made by Taupo District Council this morning following a drone inspection that revealed a weed lake substance near the water intake for the settlement.

Operational services group manager Kevin Strongman said the intake for the Hatepe supply was much shallower than the intakes for other supplies and it was important the council erred on the side of caution until test results were available.

"We will be doing the testing today but it is unlikely we will be able to get the results back until Monday.

"Over the weekend we will be trucking water from Turangi and we will reassess the situation once the results are known."

About 100 properties are affected. Residents are being asked not to use sprinklers or water outdoors until further notice.

Other water supplies around the Taupo district are at this stage unaffected.

The council has comprehensive monitoring in place to ensure the quality and safety of all drinking water at all times.

There is currently no risk to other water supplies from this algal bloom.

The council will be increasing the frequency of testing at its other intake sites in response to the situation.