The New South Wales Health Department has issued a warning to residents in Braidwood east of Canberra to boil their water.

High levels of E coli bacteria were found in the water supply today after a fault in the council's water treatment process.

The department is urging residents to boil any water for at least three minutes before consumption.

Palerang Mayor Jim MacLachlan says the council is currently carrying out maintenance on the chlorination plant.

"We had a problem with the chlorination of the water supply in Braidwood," he said.

"For some reason the pH is very high and therefore the dosing of chlorine is more difficult but there has been a minor malfunction within in the chlorination plant and that's being worked on by staff."

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