An outbreak of Giardia lamblia gastroenteritis occurred in Reno, Nevada, in 1982, during which 324 laboratory-confirmed infections were reported. During the outbreak, Reno was supplied in part by surface water that was chemically coagulated, settled, and chlorinated, but was not filtered. Giardia cysts were recovered from the water supply, and a beaver infected with Giardia was found in one of the reservoirs. A case-control study indicated that, during the outbreak but not afterwards, persons with giardiasis drank more municipal water than did controls. Corrective measures, which included removing the infected beaver and increasing the chlorine concentration, were followed by a rapid decrease in reports of giardiasis.