Following routine water sampling and testing, over a series of weeks low level contaminants were found at Prospect, Potts Hill, Sydney Hospital, the NSW Art Gallery, Macquarie Street, Centennial Park, Surry Hills, Rhodes, Enfield, Palm Beach and water treatment facilities at Warragamba, Nepean, North Richmond, Orchard Hills, Woronora, Macarthur, the Illawarra and Prospect.

[1] Precautionary "boil water" alerts were raised covering several suburban areas for the period of the crisis.

[1]: 13 In response to the crisis, the Government of New South Wales established a Commission of Inquiry, chaired by jurist Peter McClellan QC as Commissioner.

A network of nine major dams plus several minor storage reservoirs was used to collect and store water, which in turn was delivered to a network of over 20,000 kilometres (12,000 mi) of water mains, 165 pumping stations, and 261 service reservoirs.

These are located at Orchard Hills, Cascade, North Richmond, Nepean, Warragamba, Linden and Greaves Creek.

[1]: 7 The lack of cases of cryptosporidiosis, giardiasis, or any other health problem which might be attributed to tainted water led to suggestions the microbes were either not an infectious type, or not as prevalent as measured.

The handling of the crisis by Sydney Water, a state-government owned corporation since 1995, was heavily criticised, causing the resignation of both the chairman and the managing director.

[2] The Chairman of Sydney Water, David Hill resigned ten days after the final crisis event, denied any responsibility, and claimed he was leaving only to concentrate on his political career.