Black mould was found in the Peel Health Campus’ air-conditioning system and vents, triggering an evacuation of 32 patients.
The patients were transferred to Rockingham and Fiona Stanley Hospitals.
Three operating theatres have also been shut down inside of the hospital, while the oncology and maternity wards will stay open.
The emergency department will remain open for walk-ins, however, those in ambulances in need of emergency care will be diverted to other hospitals.
Staff and patients still at Peel Health have been told to wear PPE until the mould is cleared.
The discovery sparked a rally from the community, who say the state premier has not made health a priority.
“If that’s not a signal that there’s a problem down here, I don’t know what is,” Andrew Hastie, Member for Canning said.
Sandy Austin, 79, said she has had issues at Peel Health in the past, waiting for up to seven hours to be admitted.
“[I was in] excruciating pain, I thought I was going to pass out, I really did,” she said.
“I said my prayers, obviously [I thought] just get me a bed and look after me.”
The discovery comes three months after black mould was found in the air conditioning unit at Mount Private Hospital in Perth.