Background. Perchlorate is an anion that occurs as a contaminant in groundwater. It originates from the improper disposal of ammonium perchlorate, a component of rocket fuel. The objective of this study was to explore whether the exposure to perchlorate in drinking water had an impact on the thyroid function of the population residing near an ammonium perchlorate plant in Kerala. Methodology. Using an ecological study design, we compared the serum levels of thyroid-stimulating hormone, thyroxine, and thyroid peroxidase antibodies among a representative sample of 289 study subjects from the area surrounding the ammonium perchlorate enrichment plant to 281 study subjects in a control area. Results. The perchlorate concentration in the groundwater varied from 1600 ppb to 57,000 ppb in the 10 samples from the contaminated area and was below 24 ppb in all locations in the control area. No significant differences were found in the mean serum TSH concentration and mean T4 levels between the subjects from the contaminated area and the control area. On regression analysis, perchlorate contamination was not found to be a significant predictor of TSH. Conclusion. This study did not find any significant association between perchlorate in drinking water and changes in thyroid hormone levels. Our findings indicate the need for further investigation of this hypothesis using urinary perchlorate as a measure of individual exposure.