This paper presents a simulation–optimization-based method for identification of contamination source characteristics in a water distribution system using filtered data from threshold-based binary water quality signals. The effects of quality and quantity of the data on the accuracy of the source identification methodology are investigated. This study also addresses the issue of non-uniqueness in contaminant source identification under various data availability conditions. To establish the robustness and applicability of the methodology, numerous scenarios are investigated for a wide range of contamination incidents associated with two different networks. Results indicate that, even though use of lower resolution sensors lead to more non-unique solutions, the true source location is always included among these solutions.