Some 100 water supply schemes have been classified as 'at risk'
Utility company Irish Water is to lower the pressure in the greater Dublin area at night time to conserve supplies.
Irish Water says it can sustainably and safely produce 610 million litres of water per day.
But in the past 24 hours, it claims this reached 615 megalitres.
"This level of demand meant drawing from treated water storage to maintain full supply", the company says.
"This option can only be maintained for a limited period of a few weeks.
"This record level of summer consumption is also depleting raw water reserves needed for the coming months."
Its Drought Management Team is meeting daily and is monitoring water supplies and demand around the country.
Irish Water adds that its priority is to minimise the impact on homes and businesses, particularly during this period of holidays and high tourism.
It says the lowered night time water pressure levels for the capital "will not impact businesses but will assist Irish Water managing demand more effectively."
"Irish Water is monitoring reports of private side leaks and other non-essential uses and is reviewing its enforcement options."
The utility adds that it remains "very concerned" about the possibility of having to impose restrictions in the long term.
It says this will become unavoidable if the dry conditions persist into the autumn with lower than normal rainfalls.
Nationally, the company has identified 100 water supply schemes around the country that are at risk.
Customers in Kilkenny, Longford, Athlone, North Galway, Louth and Kerry have already experienced restricted water supply and outages in some cases.
Currently, almost 4,000 customers are impacted.
Some areas in Cork, Wicklow, Limerick, Kilkenny, Carlow, Tipperary, Clare, Mayo, Sligo, Donegal, Galway, Roscommon, Laois, Limerick, Kerry, Waterford and Offaly have been identified as being at risk.
Irish Water's corporate affairs manager, Kate Gannon, says: "We are very grateful to the public and to businesses for all efforts to conserve water.
"Every small measure has a positive impact.
"We were very encouraged for example to see Dublin Bus commit to only washing their fleet every three days instead of every day.
"Several other businesses who are large water users have confirmed to us that are implementing water conservation measures and we are very thankful to them for their contribution."
"Where restrictions are necessary we are endeavouring to do them at times that will have the minimal impact on homes and businesses."
She adds: "Lowering the water pressure in Dublin is designed to save water without causing disruption to customers.
"We have a long way to go. If the drought is prolonged, water restrictions would become unavoidable if demand does not continue to drop.
"Irish Water are appealing to the public to be continue to be mindful of their water usage."
Irish Water has also been liaising with farming representative groups.