Victorian lake tested for toxic algae

Residents are warned not to swim in a popular outer Melbourne lake as water authorities investigate a report of toxic blue-green algae.

Melbourne Water says it is investigating and testing the water at Lillydale Lake in Lilydale after concerns raised by members of the community.

"If blue-green algae is present, signs will be erected warning the community to avoid contact with the water," manager (northeast) Steve Hosking told AAP on Tuesday.

"People should avoid contact with the water and make sure that it does not come into contact with their skin or eyes."

Yarra Ranges Council warned residents that swimming in the lake was not recommended at any time and signage at the lake advises just that.

Results from water tests are expected in the next few days.

Contact with blue-green algae can cause skin irritation, mild respiratory effects and hayfever-like symptoms.

Pet owners are also warned not to let their dogs swim or drink in water where blue-green algae is present.