Western Australia's Water Corporation is scrambling to enact emergency repairs, after a burst pipe left thousands without water in the state's South West.

The outage, first reported early this morning, is impacting about 5,000 people in Dunsborough, 250km south of Perth.

Residents reported the outage as early as 4am on Thursday, but the burst wasn't located until just before 9am. 

Water Corporation south west regional manager Nicky Waite said the location of the burst, Peron Reserve along Caves Road, was hard to find due to the surrounding wetlands. 

A local called the hotline number while working their dog upon seeing the "unusual" amount of water in the wetland reserve.

Ms Waite said the location was fortunate as the water leaked into the wetlands, which flow into the established drainage system.

She said the utility provider would supply tanker and bottled water at the Dunsborough Lakes Sporting Precinct for household use as it works on repairs. 

The Department of Education has also provided water bottles and portaloos to the sole public school in the town, Dunsborough Primary, and will inform parents of any change based on Water Corporation updates.

Ms Waite said there was no official timeline for when repairs will be completed and water access returned but she said the aim was before the end of the day.

Regional Manager Nicky Waite said she expected outages affected most of the town and apologised to customers.

"It is an obviously an emergency incident that has happened without warning... incidents like these are rare," she said

"We have some parts of Dunsborough out of water and we expect that potentially [soon] the whole of Dunsborough will be out of water."

Resort owner offers pool water

Ms Waite said the cause of the incident would not be known until repairs were further along.

"It's a little bit hard to tell whether it's been a split or a connecting piece issue. Until we excavate we can't say the exact cause," she said.

"This section of pipeline was installed between 1993 and 1994 so it's not old in terms of pipelines, but once we get into it we will know more."

The owner of the Dunsborough Lakes Holiday Resort, Herbie Schaal, was informed by customers at 7am that the water was out.
 
With almost 100 customers to cater for, he said it was a "mad rush" as he tried to sort out what had happened.

He said the Water Corporation had asked him to keep the facility's pool open to use for flushing toilets, and he had extended the offer beyond just guests at his business.

"We will [let] anyone have water out of our pool, that's not a problem at all. People are more than welcome," Mr Schaal said.