As the lake is downstream from abandoned uranium mine sites and their associated tailings ponds, the water is significantly contaminated with cobalt. Data from the Provincial Water Quality Monitoring Network shows elevated concentrations of cobalt similar to those found in surface water around Cobalt, Ontario. Subsequent testing by the Ministry of the Environment concluded in a 2003 report that only sites immediately downstream of Madawaska Mine (none of which are on Paudash Lake) "consistently exceeded Provincial Water Quality Objectives (PWQO) for uranium contamination", but noted as well that concentrations of uranium and radon-226 in the top level of sediments in lower Paudash Lake are higher than background levels and higher than in subsurface sediments, suggesting relatively recent dispersal of these contaminants.