At least 11 people are known to have died near the Pakistani city of Hyderabad as a result of drinking contaminated water.
A family mourns for a child victim of the poisoned water
The polluted water was discharged from a lake into the river Indus.
Health department officials say that hundreds more people have been made sick because of the dirty water, described as being highly saline.
The chief minister of Sindh province said that $3,500 will be paid in compensation to the bereaved families.
The BBC's Ali Hassan in Hyderabad says that all government run and private hospitals in the city and towns located near the contaminated part of the river Indus were packed with patients suffering from stomach pains, dysentery and vomiting.
The Chief Minister of Sindh, Ali Mohammed Mehr, said that figures detailing the number of people who had died or who had been made sick were only available from government run hospitals.
"Nobody knows about the fate of those patients who were admitted in private hospitals or who were treated at home," he said.
Mr Mehr has visited some of the hospitals treating the sick and pledged to double the amount of compensation paid to the families of the dead. He described the poisoning as "an epidemic".
"Most of patients brought to Liaquat medical college hospital suffered from dehydration," said Medical Superintendent Hadi Bux Jatoi. "We treated them promptly thus they were saved."
The water poisoning began earlier this month when polluted water was discharged from the lake.
It is not clear what is the source of the contamination.
Angry crowds gathered outside government offices on Monday to demand that officials responsible for water supply be punished. They are reported to have thrown stones at shops and vehicles.
Searching for water near Hyderabad
Neither the irrigation authorities nor water supply officials in Hyderabad noticed that water was polluted.
Our correspondent says that water supply arrangements in the interior of Sindh, including Hyderabad city, are in a shambles.
He says that in recent months the authorities have not had enough money to treat water with chlorine, which kills bacteria.
It is estimated that Hyderabad city requires 70 million gallons of water every day yet receives only around 40 million.
Doctors have meanwhile warned people in the city not to drink water unless it has been boiled.