More than 1,600 fish were killed after a chemical leaked into Annsborough River, near Newcastle, on Saturday.
NI Water's head of environmental regulation, Angela Halpenny, said her company was "extremely sorry to learn of this very unfortunate incident".
Angler Ed Kilgore said local clubs had been "robbed of this season's fishing".
The Shinma Angling Club committee member said it was "horrible to see so many fish dead".
Mr Kilgore expressed fears that despite plans to restock, fishing and the health of the river could be affected "for the next three years".
Ms Halpenny said the accidental spillage may have been caused by damaged pipe work.
"When we purify waste water, we generate a very thin sludge, so before the sludge is transported off site we use a chemical called polyelectrolyte," she told the BBC's Good Morning Ulster programme.
Polyelectrolyte is used to thicken the sludge before it is removed from the waste water plant.
Ms Halpenny said an "unknown quantity" of the chemical leaked into the river at the weekend.
"Our primary concern was to stop the discharge to the river and assist the Northern Ireland Environment Agency (NIEA) and the relevant authorities with the clean up exercise," she said.
She added that a full investigation was under way to find out why the spill happened and to prevent any repeat.
"NI Water will work with NIEA, the relevant authorities and the local angling groups to fulfill our obligations and make arrangements for the restocking of the river at the earliest opportunity."
Northern Ireland Water has offered to restock a County Down river with fish after pollution from a water treatment plant caused a major fish kill.