A large outbreak of norovirus (NoV) gastroenteritis caused by contaminated municipal drinking water occurred in Lilla Edet, Sweden, 2008. Epidemiological investigations performed using a questionnaire survey showed an association between consumption of municipal drinking water and illness (odds ratio 4·73, 95% confidence interval 3·53-6·32), and a strong correlation between the risk of being sick and the number of glasses of municipal water consumed. Diverse NoV strains were detected in stool samples from patients, NoV genotype I strains predominating. Although NoVs were not detected in water samples, coliphages were identified as a marker of viral contamination. About 2400 (18·5%) of the 13,000 inhabitants in Lilla Edet became ill. Costs associated with the outbreak were collected via a questionnaire survey given to organizations and municipalities involved in or affected by the outbreak. Total costs including sick leave, were estimated to be ∼8,700,000 Swedish kronor (∼€0·87 million).