The Norfolk and Norwich University Hospital says there are no longer high levels of the pseudomonas bug in its water system.
A number of babies in the hospital's neonatal unit were tested following the discovery and were also found to be carrying the bacteria.
Although none became ill at the Norfolk and Norwich, three babies at a hospital in Belfast died from the infection earlier this year.
The hospital has said that following remedial work to the water supply, preliminary testing indicates that there are no longer high levels of pseudomonas in the water.Further testing of all the supply points will continue. In the meantime, the trust is continuing to use sterile water for baby care.