An Environment Southland spokesperson said the algae was found in Hamilton Burn, a tributary of the Aparima River, at Affleck Rd.
A warning had also been issued for the Waihopai River in Kennington this afternoon.
While algae naturally occur in waterways, certain types can produce harmful toxins, especially during stable river flows and fine weather.
Most algae are harmless, but some species can produce toxins and rapidly bloom to high levels.
In a statement, an Environment Southland spokesperson said toxic algae can appear as dark green or brown slime on rocks or as dark brown or black mats along the water’s edge.
"Similar algae growth may be occurring in other waterways in the area and other rivers in the region."
These algae pose risks to humans and animals if ingested or through skin contact.
The spokesperson said dogs should be kept on a lead and children kept away from affected areas.
Toxic algae was also found at Waiau River near the Excelsior Creek inflow late last month and warning remains in place for that area as well.
Environment Southland is encouraging river users to familiarise themselves with the signs of toxic algae.
"Our website provides photos and descriptions to help identify these potentially harmful blooms."
- APL
