Railtrack's new gravel dump is posing serious flooding risks to homes, the Environment Agency has warned.
The agency said urgent measures were needed to protect the area around Hinksey Sidings in south Oxford.
In a letter to Oxfordshire County Council, it warned that the ballast stockpile would make "existing flooding worse".
The flooding risk represents a new blow for residents, who say the dump is "an environmental nightmare", causing noise and dust pollution. for hundreds of homes, a nursery school and day care centre.
Railtrack now have the gravel mountain in place, in defiance of the county council and residents.
Mr David Young, the council's director of Environmental Services, said: "This is yet another reason why Railtrack should pull out of Hinksey now. "People are only too well aware of the risk of flooding in this area. For Railtrack to proceed with their development without following the Environment Agency's advice is frankly irresponsible."
The county has asked Environment Secretary John Prescott to confirm an order which would bring Railtrack's development under normal planning control.
A Railtrack spokesman said: "We are currently in discussion with the Environment Agency about this issue and are hoping to resolve it in the next couple of days."
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