Carterton's boil-water notice - issued earlier this month - has been lifted.
The order was issued to residents of the Wairarapa town on 12 March, when E-coli was detected in the water supply.
Low-level contamination was found in two bores, which supply the 4200 people on the network.
The district council says it is confident it has identified the source of the problem.
Three clear test results have been returned, showing the water is safe to drink.
The council reported two other results of the bacteria in December and January.
On both occasions, council staffers locked down two water bores in town water supplies and increased chlorine treatments after testing returned elevated levels of the deadly bacteria.