A hospital in Kunming, capital of Yunnan province, has found that 200 out of 1,000 children living near the industrial park had elevated levels of lead in their blood, the China Daily reported.
The results of an investigation by the local bureau of the Ministry of Environmental Protection were expected this week, the paper said.
But it added that the local bureau has already blamed the excessive lead levels on other factors such as car exhaust emissions, not pollution from the industrial park, located in the town of Tongdu.
Parents in Tongdu however insist the industrial park is to blame.
The accusations come after two similar incidents came to light earlier in August -- in northern Shaanxi and in central Hunan province -- which saw a total of more than 2,100 children test positive for high lead levels.
Villagers have blamed the poisonings on a pair of smelting plants in the two areas.
In the Shaanxi incident, angry villagers stormed the plant, smashing trucks in protest, according to state media reports.
Pollution-related health scares are common in China, where an emphasis on economic growth has lead to widespread disregard for environmental protection.