Around 973 people, including women and children, have been admitted in various hospitals in Reyar, Waterhal, Kralnaar, Hardpanzu and Sholipura after they showed symptoms of gastroenteritis.
Experts are trying to ascertain if the patients are suffering from cholera.
"In some villages the outbreak was of moderate to serious nature. In districts like Waterhal, Kralnaar, Tehsil Khansahab and Tehsil Bhiru, it has took a very dangerous shape. Total cases that have been reported till today morning in different primary health centers, dispensaries and hospitals is around 900," said Mohammad Rafi, Deputy Commissioner, Budgam.
Locals are claiming that nearly 25 villages have been affected due to the water-borne disease, as heavy rains contaminated rivers and streams, which are the main source of their drinking water.
"Almost 20 to 25 villages are affected by cholera. I think it is water-borne disease. Due to heavy rain there has been water stagnation at many places, due to which drinking water got contaminated," said Bashir Ahmad, a local.
The disease has not only created panic amongst the villagers but has also set alarm bells ringing in the state Health Department.
Teams of doctors and specialists have been rushed to the affected areas to control the outbreak.
All patients affected by gastroenteritis initially showed symptoms like diarrhoea and vomiting, after which the high fever usually causes death if it is not controlled.
The health authorities have urged the villagers, particularly in the affected areas to drink boiled water to prevent the further spread of the disease.