A 20-year-old woman succumbed on Monday afternoon after suffering second degree burns on over 90 percent of her body, health authorities said.
Investigators were seeking a reason why the corn flour mix of coloured powder combusted after being sprayed over the partygoers from a machine mounted on a stage.
"The source of the heat is still under investigation," said Kevin Lo, an official with the city fire department. "The powder itself is not considered a dangerous good."
Investigators are looking at three main possibilities: cigarette embers, a lighter, or electrical sparks, Lo told Reuters on Monday.
Chou Hui-fang, an official with Taiwon Foods, the central Taiwan-based powder manufacturer which supplied the powder for Saturday`s event, said that the powder is edible, but it is made of carbohydrates, so it should not be put near any heat source.
The use of color powder has gained popularity in Taiwan in recent years to lend more festivity to public events. It has been widely used in marathons.
The municipal government for New Taipei City, which surrounds the capital Taipei, said that the water park had violated regulations by not applying for the required permission to host the party.
The event organizer Lu Chung-chi was detained by police, questioned and released on bail. The local prosecutor`s office was unavailable to comment on the case.
On live television on Sunday, Lu apologized on his knees to the public for the incident. The president of the water park also apologized on Monday.
"We rented it out like you rent a house. You don`t expect something like this to happen," water park president Chen Hui-ying said in tears on live television.
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