The Environmental Protection Agency is calling on the state to post warning signs at Kauai's Mahaulepu Beach, just upshore from the Garden Isle's gold coast.
For the past two years, testing at the beach and the nearby Waiopili Stream found extremely high bacteria levels. And environmentalists said it was caused by human waste.
"The rates were 40 or 50 times what the water quality standards are supposed to be. And we found that it was chronically polluted, more than 90 percent of the time," said Stuart Coleman, Hawaii Islands regional manager for the Surfrider Foundation.
"Higher up in the stream it gets up to 200 times what the water quality standards are."
The EPA's move comes after the Surfrider Foundation and the citizen's group Friends of Mahaulepu have unsuccessfully lobbied the state Health Department to post warning signs since 2014.
"It was really disappointing because everything we looked at and what we've all been very concerned about is that stream is really polluted," said Bridget Hammerquist of the Friends of Mahaulepu.
The state said it still talking to the EPA and hasn't yet decided whether to put up signs.
It said a study in March couldn't find whether the contamination was caused by humans or animals, which carry a lower risk.
But EPA said the state's study wasn't thorough because it didn't look close enough at a former solid waste treatment site as a possible source.
"There was a former sludge dumping site where they were taking municipal waste and processing it out there. And that went on for 11 years," said Coleman.