Discoloured water on a municipal supply is a different investigation from discoloured water on a well, because someone else is responsible for most of the possible causes and can usually tell you what happened. Three checks separate the utility's problem from your house's, and they take about five minutes.
Check one: is it just you
Ask a neighbour, or look for notices of work in the street. Yellow water across several properties, appearing suddenly, usually follows a main flush, hydrant use by the fire service, or a pressure change that lifted settled deposit off the pipe wall. That material is generally iron and manganese sediment that has accumulated in the distribution network, and it clears once the disturbed water has passed. Run a cold outside tap for several minutes; if it clears, that was it.
Check two: hot side or cold side
Yellow on the hot side only is your water heater rather than the supply: a corroding tank or a sacrificial anode near the end of its life. The cold water reaching the house is fine and the fix is at the appliance. Yellow on both sides points outward. Yellow on the cold side first thing in the morning, clearing after a minute, suggests corrosion inside your own pipework, particularly in older galvanized runs.
Check three: does it settle
Let a glass stand. Particles settling and the water clearing from the top down means suspended material, typically iron already oxidized, which is consistent with disturbed mains sediment. Water that stays uniformly coloured suggests something dissolved. That distinction matters less on a municipal supply than on a well, since the utility's answer usually explains it, but it is worth noting when you report the problem because it helps them identify the cause.
Reporting it, and what not to do meanwhile
Call the utility: they will know about mains work and hydrant use, they are obliged to investigate, and they can tell you whether it is safe to use. The EPA notes every community water system publishes an annual Consumer Confidence Report and maintains a finder for them, which covers what the system monitors routinely. Meanwhile do not wash light coloured laundry, and do not use chlorine bleach on anything already stained, since it fixes iron staining rather than removing it. Our tap water guide covers supply differences by area.
Questions people ask about yellow tap water
Is yellow tap water safe on a municipal supply?
Often it is disturbed iron sediment from the mains, but the utility should be told, since they can confirm the cause and whether it is safe.
Why is only the hot water yellow?
That is the water heater rather than the supply: a corroding tank or a spent sacrificial anode.
Should I run the tap?
Yes, a cold outside tap for several minutes. If it clears, disturbed mains sediment was the cause.
What should I avoid doing meanwhile?
Washing light laundry, and using chlorine bleach on stained items, which fixes iron staining instead of removing it.