They were dumped on the Baranailt Road in Claudy beside the River Ness, a tributary of the River Faughan,
The sludge is the by-product of illegal fuel laundering.
Chris Thompson, from River Faughan Anglers, said an oil slick was visible on the surface of the river, but there did not appear to have been a fish kill.
He said the dump was spotted by local people at about 19:00 BST on Thursday.
Mr Thompson said some of the containers were either burst or lying on their side, but much of the waste had been stopped from going into the river by the Loughs Agency.
However, he said a lot of the sludge had spilled into gravel in the road and he was concerned it could still end up in the river.
He said those responsible "have no respect for the environment or other people's properties. The people who buy this should be aware of the people they're dealing with."
Northern Ireland Environment Agency staff are at the scene of the dump.
Environment Minister Mark H Durkan said he was "keeping a very close eye on developments".
"Our contractors are on site to provide additional containment of the oily waste to ensure the river is protected.
"The River Ness is a contributory river to the River Faughan, which is popular with local anglers.
"I want to pay tribute to the River Faughan Anglers for their vigilance which enabled a swift response from statutory agencies.  My officials are assessing what damage, if any, has been done to the river."
Containers of toxic sludge have been dumped metres from a river on a County Londonderry road.