Lake Clearwater in Ashburton is closed due to a potentially toxic algal bloom.
The algal bloom is caused by increased nitrogen and phosphorus levels in the catchment.
Debs Martin, Forest & Bird regional conservation manager, was at the lake this week and was horrified by the brown cloudy lake water.
"Right now it looks like pea brown soup and it's not safe to use. It's just awful. You should be able to see down into the depths of the lake, that's how the lake got its name and why fishers and holidaymakers love it so much.
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"This lake is incredibly important for wildlife, like diving birds that need to be able to see prey in the water to feed. We've wrecked their only home. The councils responsible need to do better."
Land-use intensification of sheep and beef farming over the past 10 years is taking a toll on biodiversity and recreation for Lake Clearwater and neighbouring lakes and wetlands, Martin said.
The area is normally known for wildlife like Australasian crested grebes and secretive wetland birds like bitterns, as well as recreational fishing, boating, and windsurfing.
Martin said neither district nor regional councils are doing enough to protect fresh water.
"There are standards in place and monitoring is occurring, but after 15 years of failing to meet their own standards the regional council has not taken the actions necessary to actually stop intensification and the extensive use of fertilisers.
"They need to take action now. We could lose these incredible natural lakes and essential habitats. I worry it may already be too late."