Hundreds of dead eels and trout have been discovered in the Lower Silver Stream near Dunedin.
A fisherman alerted Fish and Game and Otago Regional Council staff visited the stream last night.
Fish and Game spokesman Ian Hadland said the likely cause of death was warm, low oxygen inflows of ponded floodwater from surrounding farmland.
He said rotting grass and vegetation in the water was known to decrease water oxygen levels and that alongside hot weather created lethal conditions.
"We've done some recordings of oxygen levels in the Lower Silver Stream and they're still critically low.
"Not at a completely toxic level at the moment but it obviously has been in the last week or so to cause this."
Hadland said seeing the decomposing fish, eels and dead worms all over the stream was a tragic sight.