Lake Burrumbeet has been temporarily closed by the City of Ballarat, after testing detected blue-green algae in the water.
All water-based activities, including swimming, fishing and boating have been banned until further notice.
Some species of algae produce toxins that are harmful when consumed, inhaled or come into contact with skin.
In a statement, Director of Infrastructure and Environment at the City of Ballarat, Bridget Wetherall, says they understand the closure may inconvenience lake users, but protecting the health of the community is paramount.
The closure will remain in place until test results confirm its safe to reopen.