The Environmental Protection Agency says water for nearly 1 million people is at risk of contamination.
Its recommending improvements for 121 water schemes which provide water to 940 thousand people.
It's a slight drop on the number of supplies earmarked for essential improvements at the beginning of last year.
But at least 21 will not be completed until next year at the earliest.
Among the issues are a lack of proper management at water treatment plants and work on disinfection systems to remove bugs including e-coli and cryptosporidium.
Over 99 percent of supplies meet standards, according to the EPA's Drinking Water Report for 2013 released today.
At the minute over 20 thousand people, on 20 public water supplies, are affected by boil notices.
