The council's decision to lift the notice was made in conjunction with Public Health South and means both parties are now satisfied the water is safe to drink, as long as people follow some advice to flush their taps regularly, the DCC said.
However, Public Health South has recommended that people at the Waikouaiti Golf Course and Karitane School do not drink the water there.
Mayor Aaron Hawkins said the welfare of all residents had been the DCC's top priority throughout the investigation into the elevated lead readings.
"This has been a difficult time for these communities, and I want to thank everyone for the patience and understanding they have shown while we work through the issue.
"We know it's taken time and been stressful, but we have done everything we can to ensure the wellbeing of everyone living in affected areas."
DCC Chief Executive Sandy Graham said extensive sampling, monitoring and investigation had found there was no widespread lead in the DCC's drinking water network.
The investigation looked at all possibilities, including whether lead came from old landfills, fly tips or the nearby Macraes mine, as well as more than 2000 tests carried out across the DCC water network since February.
The source of intermittent elevated lead levels had not been conclusively determined but was most likely to be pipes and fittings on private properties, rather than the DCC's water distribution network.
"The drinking water that comes from our network supply is safe. However, metals, such as lead, can leach from pipes and fittings into the water if it's been sitting overnight.
"This isn't just an issue for Dunedin – it's a national and international issue," Ms Graham says.
The risks from metals such as lead in the water are low, but there are simple things people can do to reduce the risk even further, Ms Graham says.
Recommendations
The Ministry of Health recommends people flush a small volume of water – about 500ml – from the cold tap before using water for drinking, cooking or brushing teeth.
People should also run a cold tap for about 30 seconds each morning, to flush out the water sitting in pipes overnight.
The DCC would be rolling out a public campaign to promote the 'flushing taps' message across the city, Ms Graham said.
In the meantime, work to replace DCC-owned water pipes with old lead fittings in Edinburgh St and surrounding streets in Waikouaiti wass now largely finished.
She said water sampling in all affected areas was continuing, and there had been no further elevated post-flush lead readings since the last higher result on January 20.
The DCC was also confident there is no E. coli in the water. Following testing and investigation, the most likely cause of the unusual recent E. coli reading was contamination of the water sample.
