Fireworks produce smoke and dust that may contain residues of heavy metals, sulfur-coal compounds and some low concentration toxic chemicals. These by-products of fireworks combustion will vary depending on the mix of ingredients of a particular firework. (The color green, for instance, may be produced by adding the various compounds and salts of Barium, some of which are toxic, and some of which are not.) Some fisherman have noticed and reported to environmental authorities that firework residues can hurt fish and other waterlife because some may contain toxic compounds such as antimony sulfide. This is a subject of much debate due to the fact that large-scale pollution from other sources makes it difficult to measure the amount of pollution that comes specifically from fireworks. The possible toxicity of any fallout may also be affected by the amount of black powder used, type of oxidizer, colors produced and launch method.
Fireworks have also been noted as a source of perchlorate in lakes. The U. S. Environmental Protection Agency's Richard Wilkin and colleagues, have conducted research on the use of pyrotechnic devices over bodies of water noting concerns over the effects of environmental perchlorate on human health and wildlife. Sources of perchlorate range from lightening and certain fertilizers to the perchlorate compounds in rocket fuel and explosives. Scientists long suspected community fireworks displays were another source, but few studies had been done on the topic. Wilkin's group has now established fireworks displays as a source of perchlorate contamination by analyzing water in an Oklahoma lake before and after fireworks displays in 2004, 2005 and 2006. Within 14 hours after the fireworks, perchlorate levels rose 24 to 1,028 times above background levels. Levels peaked about 24 hours after the display, and then decreased to the pre-fireworks background within 20- to 80 days. The study is detailed in the June 1, 2007 issue of the journal Environmental Science & Technology. ( Environ. Sci. Technol., 2007, 41 (11), pp 3966–3971) 
Perchlorate, a type of salt in its solid form, dissolves and moves rapidly in groundwater and surface water. Even in low concentrations in drinking water supplies, perchlorate is known to inhibit the uptake of iodine by the thyroid gland. While there are currently no federal drinking water standards for perchlorate, some states have established public health goals, or action levels, and some are in the process of establishing state maximum contaminant levels. For example, the US Environmental Protection Agency have studied the impacts of perchlorate on the environment as well as drinking water.  California has also issued guidance regarding perchlorate use. 
Several states have enacted drinking water standard for perchlorate including Massachusetts in 2006. California's legislature enacted AB 826, the Perchlorate Contamination Prevention Act of 2003, requiring California's Department of Toxic Substance Control (DTSC) to adopt regulations specifying best management practices for perchlorate and perchlorate-containing substances. The Perchlorate Best Management Practices were adopted on December 31, 2005 and became operative on July 1, 2006.  California issued drinking water standards in 2007. Several other states, including Arizona, Maryland, Nevada, New Mexico, New York, and Texas have established non-enforceable, advisory levels for perchlorate.
The courts have also taken action with regard to perchlorate contamination. For example, in 2003, a federal district court in California found that Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) applied because perchlorate is ignitable and therefore a “characteristic” hazardous waste. (see Castaic Lake Water Agency v. Whittaker, 272 F. Supp. 2d 1053, 1059-61 (C.D. Cal. 2003)).
Pollutants from fireworks raise concerns because of potential health risks associated with hazardous by-products. For most people the effects of exposure to low levels of toxins from many sources over long periods are unknown. For persons with asthma or multiple chemical sensitivity the smoke from fireworks may aggravate existing health problems. Environmental pollution is also a concern because heavy metals and other chemicals from fireworks may contaminate water supplies and because fireworks combustion gases might contribute to such things as acid rain which can cause vegetation and even property damage. However, gunpowder smoke and the solid residues are basic, and as such the net effect of fireworks on acid rain is debatable. The carbon used in fireworks is produced from wood and does not lead to more carbon dioxide in the air. What is not disputed is that most consumer fireworks leave behind a considerable amount of solid debris, including both readily biodegradable components as well as nondegradable plastic items. Concerns over pollution, consumer safety, and debris have restricted the sale and use of consumer fireworks in many countries. Professional displays, on the other hand, remain popular around the world.
Others argue that alleged concern over pollution from fireworks constitutes a red herring, since the amount of contamination from fireworks is minuscule in comparison to emissions from sources such as the burning of fossil fuels. In the US some states and local governments restrict the use of fireworks in accordance with the Clean Air Act which allows laws relating to the prevention and control of outdoor air pollution to be enacted. Few governmental entities, by contrast, effectively limit pollution from burning fossil fuels such as diesel fuel or coal. Coal fueled electricity generation alone is a much greater source of heavy metal contamination in the environment than fireworks.