The incident happened just before 11 a.m. and involved a 3,000-gallon truck filled with sodium hydroxide.
The caustic material reacted with something in the truck and caused it to bubble and fizz.
Residents between Hillview and King avenues between Kimball Ave and McCollum Pl were asked to stay put, but the shelter-in-place order was lifted around 1:30 p.m.
Sodium hydroxide is the chemical added to neutralize chlorine in drinking water.
A specialized Yonkers Fire Department task force responded and crews spread vermiculite and used water to dilute the spill.
Police say the chemical was cleaned up and there is no threat to the public water supply.
No injuries were reported to humans or wildlife.
The Hillview Reservoir holds a billion gallons of drinking water for New York and Yonkers -- about a one-day supply.
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