Emergency water supplies being provided for residents in the Old Mervue area of Galway city had to be suspended because high levels of lead were found in it overnight.
Galway City Council says it is "disappointed" at this latest development and is making arrangements to provide an alternative supply for containers.
The Mayor of Galway, Pádraig Conneely (Fine Gael), says the situation is "appalling and totally unacceptable".
The street taps (photo) at the centre of this latest scare were installed on Wednesday and Galway Corporation assured the about 1000 residents who live in Old Mervue that the water was safe to drink.
However, last night one of two tests carried out on the water showed that it contained over four times the acceptable level of lead.
The City Council says it immediately suspended this emergency service and is awaiting the result of further analysis which will be available on Monday.
In the meantime it is arranging to have safe drinking water provided from containers which will be located around the estate.
A spokesman said the city administration was "disappointed" with the result of the test and it apologised to the residents.
Mayor Pádraig Connelly admitted that he was "shocked" by the news. He said it was now time for Environment Minister John Gormley (Green Party) to come to Galway and appoint a senior official from his department to take charge of the city's water services.
He said the most worrying thing was the effect drinking the water might have had on residents.
Councillors in Galway met for almost five hours last night to discuss lead contamination in part of the city's water supply. They were told that short and long term solutions were being examined in an effort to resolve the issue. But the city's Mayor said that not enough was being done to restore public confidence.
There were heated exchanges at the meeting between officials and elected representatives, with Padráig Conneely describing an action plan to deal with the latest problem as "pathetic".
The Mayor told the meeting that he had "no confidence in the City Manager and the Council's Director of Services".
He said the way the authorities had dealt with lead contamination in the water supply was not acceptable. The city management was "trying to spread the blame for the contamination of the water supply with excessive lead content". But, he said, that blame lay squarely with those responsible for water services at Galway City Council.
City Manager Joe McGrath said he was "shocked and horrified" by the allegations made against his management team. He had always treated the Council with respect and was endeavouring to answer all questions relating to the lead contamination.
He said that it was "a load of nonsense to suggest that the authorities were operating under a veil of secrecy" and added that the problem with the water supply had been identified because of action by Galway City Council and the HSE.
He was trying to provide leadership to solve the latest crisis, but he needed the backing of Council members to achieve this.
The City Manager stated that the Council was not trying to spread the blame and would not hand over management of the water services to any individual. He accepted that confidence in the water supply had been damaged, but stressed that the Council was "doing everything it could to solve the problems caused by excessive lead content" and that "a number of potential solutions are being looked at". These include an adjustment of ph levels in the water, additional treatment measures and - eventually - the replacement of a lead distribution pipe in the Old Mervue part of the city. However, this could take up to two years to complete.
Earlier, the Council's Director of Services, Ciaran Hayes, told the meeting that the water in Galway was "of the highest quality" and that the latest problems stemmed from the use of lead piping in some parts of the city. He added that short, medium and long term solutions were being initiated to address the issue.
In the meantime, residents in the areas affected by the contamination will meet Council officials over the next fortnight. It was agreed that free bottled water will be provided to elderly residents in the affected areas with two-for-one promotions available to other residents in those areas.
Well, here we are, eight years into the 21st century, and after a decade of unprecedented social and economic boom that brought Ireland massive wealth. And we cannot even give the people of the country's fourth-largest city decent drinking water. It beggars belief and only shows the high level of incompetence present in the 'city of tribes'.
Instead of being "shocked" and making a spectacle of themselves in public, both the Mayor and the City Manager should resign, together with all the other Councillors and directors of the city's administration (and they would, if they had any decency).
And next summer, when we have local elections, the good citizens of Galway - or at least those who are still alive by then - will surely give the current Council and administration a suitable answer for their series of blunders.
The Emerald Islander