United Utilities has pleaded guilty to supplying water that was unfit for human consumption to hundreds of thousands of customers.
Around 700,000 people had to boil their water before drinking for nearly three weeks between 30th July 2015 and 18th August 2015.
Cryptosporidium, a microscopic parasite, was found during routine tests at the Franklaw water treatment works in Preston, which if ingested is said to cause diarrhoea and abdominal cramps.
People in Blackpool, Chorley, Fylde, Preston, South Ribble and Wyre were affected by the outbreak.
The case was brought forward by the Drinking Water Inspectorate (DWI).
The District Judge has referred the case to Crown Court for sentencing at a future date.
A spokesperson from United Utilities said: “We have taken a full and open role with the DWI during its investigation and complied with all its requests for information. A full programme of remedial and repair work has already been implemented to safeguard future supplies.
“We will not be making any further comment until after sentencing later this year.”