Two sources, who the Otago Daily Times will not name, have indicated a large number of pupils have seen the picture.
It is unclear how the photo came to be in the hands of pupils, but an ODT staff member has seen the picture and said the teacher was clearly identifiable.
Waitaki Boys' High School rector Darryl Paterson yesterday said he would be seeking legal advice and speaking to the school's commissioner, Invercargill lawyer Craig Smith, before commenting at length.
"There is other information, but I would prefer to talk to the commissioner first and seek his advice and some legal advice before I make any statement to the media."
Mr Smith was in town on Wednesday, but he did not speak to him about the matter.
He declined to answer whether the school had investigated the allegations it had heard "at this stage" and declined further comment.
Mr Smith said he was travelling yesterday and would respond today after he had made inquiries.
Sergeant Tony Woodbridge, of Oamaru, said police were aware of the existence of a photograph, but had not seen any evidence or received a complaint and no investigation was under way.
Ministry of Education sector enablement and support deputy secretary Katrina Casey said the ministry was "made aware that some allegations were made".
"The commissioner is the employer of staff, and as such will work through any process required," she said.
