Twenty six homes were evacuated at Weston, Cheshire, after chemical giant ICI discovered high levels of hexachlorobutadiene (HCBD) seeping through the ground.
The substance, which is known to cause kidney damage in rats, came from industrial waste which was dumped in disused quarries in the village.
It was first detected in December 1999.
North Cheshire Health Authority tested 70 people from the 26 homes with high levels of HCBD and discovered that half were suffering kidney abnormalities.
Kidney function
Dr Brian Staples, who headed the investigation, said: "Our results suggest that some of the people who had health checks have been exposed to something which has had an effect on kidney function.
"We believe that the balance of evidence indicates that, for the people who had health checks, there was a small health risk associated with these findings.
"It has to be recognised that there are some uncertainties surrounding our results and we cannot be sure that what we have observed is due to land contamination."
Residents will continue to be tested to see if their kidneys repair themselves after they have moved away from the contaminated houses.
Weston Residents Action Group spokesman Mike Price said: "Of course this is a worrying development but it must be seen in context.
"We must await further tests and hope that there is some improvement now that they have moved away from the contaminated area."