NHILL has access to clean drinking water for the first time.
GWMWater began works to provide piped drinking water to Nhill in May last year.
The authority has now completed the changeover of the town's borewater supply to drinking water that is sourced from reservoirs in the Grampians.
The new supply began flowing on Tuesday.
Managing director Mark Williams said the upgraded water supply was safe for drinking and met Australian Drinking Water Guidelines.
"Not only is it safe for drinking, it is much lower in salinity meaning a longer life for hot water services, dishwashers and other water-using domestic appliances," he said.
"The lower salinity also means that less water will be required for garden watering."
Completion of the project means residents will no longer need to rely on their rainwater tanks or packaged water for drinking and food preparation.
"The township of Nhill will retain part of its borewater system to provide a 'fit for purpose' supply to sporting reserves and public land," Mr Williams said.
"This will assist in keeping the town green during dry weather."
Mr Williams said the authority was pleased to be able to provide Nhill customers with a world-standard drinking supply.
"A newsletter advising customers they can now drink the town supply will be circulated throughout the town," he said.
The 43-kilometre pipeline taps into an existing water main through Dimboola.
A new balancing water tank and pump station were constructed north-west of Dimboola.
From the new tank and pump station, the pipeline runs west along Coker Dam Road and then north along Winiam East Road to the existing Nhill water tower.
Nhill Alive with Business Opportunity chairman Alex Graham said the water was beneficial for the town.
"Most people wanted it and now it's here," he said.
"I will still continue to drink my tank water though."
He said the world-standard water supply would hopefully help attract people to the area.
"It was the people who had moved here who wanted a town supply," he said.
"Most people who grew up here are used to drinking tank water."