Areas with low, adequate and excessive I content in water co-exist in China. Limited data are currently available on I nutrition and thyroid disease in lactating women and their breast-fed infants with different I intakes. This study aimed to evaluate I nutrition in both lactating women and their infants and the prevalence of thyroid disease in areas with different levels of I in water. From January to June 2014, a total of 343 healthy lactating women (excluding those taking anti-thyroid drugs or I supplements within a year of the study, consuming seafood at the time of the study or those diagnosed with congenital thyroid disease) from Beihai in Guangxi province and Jiajiazhuang, Yangcheng, Jicun and Pingyao townships in Shanxi province were selected. Compared with the I-sufficient group, median urinary I concentrations in both lactating women and infants as well as breast milk I levels were significantly lower in the I-deficient group (P<0·001). The prevalence of thyroid disease in lactating women, particularly subclinical hypothyroidism, was higher in the I-excess group than in the I-sufficient group (P<0·05). In areas with excessive water I content, high thyroid peroxidase antibody and high thyroglobulin levels were risk factors for abnormal thyroid-stimulating hormone levels. Our data collectively suggest that excessive I intake potentially causes subclinical hypothyroidism in lactating women. Moreover, enhanced monitoring of I status is important to avoid adverse effects of I deficiency or excess, particularly in susceptible populations such as pregnant or lactating women and infants.