A recycling firm at an industrial estate in Lenwade has been found to be operating without planning permission.
Council and Environment Agency officers visited Poly Pure on Norwich Road last month following concerns from residents about plastic dust being blown from the site.
The company, which refines PVC plastics so they can be reused, was found to have an "excessive" amount of waste stored outside its unit during the visit on April 29.
Norfolk County Council also concluded the firm does not have proper planning permission and must now apply retrospectively.
It comes after a petition signed by more than 200 people was launched to stop the company from operating at the site.
A spokesperson for Poly Pure claimed the company was not operating illegally and that there was no dust being blown from the site.
The firm's planning consultant, John Brigham, said change of use permission was required, but only for one of the company's units.
An Environment Agency spokesperson said it visited the site after the county council suggested the tonnage limits within the company's waste exemption had been exceeded.
The spokesperson said: "At the time of our visit we found the site had an excessive volume of waste stored outside due to plant/machinery breakdown.
"The company hired additional plant/machinery to enable them to clear the backlog and return to storing and treating most waste inside the building."
The spokesperson said there was "nothing" to indicate dust was being blown off the site.
Broadland District Council visited the site on Thursday, May 16 and found the process reportedly causing plastic dust was also being carried out indoors.
Mr Brigham, Poly Pure's planning consultant, said a retrospective planning application would have to be submitted to the council.
He said the company had to split its operation and occupy a second unit, which only had permission for storage and distribution.
As a result, the company is in the process of preparing a change of use application.
A Poly Pure spokesman said the company employs 60 people and was not operating unlawfully.
The spokesperson said: "There is zero justification for any complaints."
Comments: Our rules
We want our comments to be a lively and valuable part of our community - a place where readers can debate and engage with the most important local issues. The ability to comment on our stories is a privilege, not a right, however, and that privilege may be withdrawn if it is abused or misused.
Please report any comments that break our rules.
Read the rules here