Residents of a Gold Coast suburb can stop boiling their drinking water, following an E. coli scare, according to Queensland Health.

On Friday, people in Nerang were warned to boil their drinking water due to fears that high level of E. coli might have placed more than 2, 500 households at risk.

Gold Coast Water (GCW) said it had since been advised by Queensland Health that water supplies were safe. Daphne McDonald, chair of GCW said more tests would be done in the next week.

The alert has now been lifted and residents in the affected areas can return to drinking the town water supplies without needing to boil the water first, she said in a statement.

The cause of the contamination has yet to be found, but water quality testing and internal inspections of reservoirs at the weekend, showed water quality was well within guideline limits, she said.

The decision on late Friday to ask some residents in a certain area of Nerang to boil their water was both a precaution and a response to advice provided from Queensland Health.

The area impacted was Nerang properties west of the railway line and north of the Nerang River. Water across the remainder of the Gold Coast is safe to drink.

Gold