Lake Tutira has an algal bloom likely to be toxic to people and animals, says Hawke's Bay District Health Board Medical Officer of Health Dr Nicholas Jones.
He said tests confirm a cyanobacteria bloom, visible on the lake north of Napier.
Cyanobacteria - often called blue-green algae - can produce toxins harmful to people and animals when it blooms.
In Hawke's Bay it blooms at the height of summer in nutrient-rich water and can form mats on riverbanks which are usually dark green/brown in colour.
Warning signs were permanently in place at Lake Tutira but people were urged to avoid contact with the lake water and to keep animals away while the cyanobacteria were present.
Dr Jones said Hawke's Bay Regional Council would continue routine testing, which would provide a good picture of the health risk.
Cyanobacteria poses a risk to people and animals when consumed in drinking water or by direct contact with water.
Eating fish from the lake should also be avoided as fish can accumulate toxins from the bloom in their gut. If people did choose to eat fish from the lake they should make sure all the gut and liver was removed and the fish thoroughly washed before cooking.
Cyanobacteria are single-celled creatures with characteristics in common with both bacteria and algae. In warm nutrient-rich conditions, free-floating cyanobacteria cells can multiply quickly to form algal blooms.
Large numbers of cyanobacteria can also grow as mats on river and lake beds and can detach and float to the surface.
Particular caution needs to be taken with algal mats that are floating on the surface or washed up on the river's edge.
Dogs die every summer in Hawke's Bay following contact with the mats, sometimes eating them after being attracted by their musty smell.
One death last month was mistakenly linked to possible cyanobacteria at Pakowhai Country Park, but water testing showed the park to be free of cyanobacteria.
Warnings against swimming at Patangata, Horseshoe Bend and Red Bridge in the Tukituki River remain in place due to cyanobacteria mats.