IT links in Orkney to facilities including schools and care homes were lost after a fibre optic cable was damaged.
The cable in Junction Road, Kirkwall, was cut on Tuesday during work linked to the construction of a new hospital.
Orkney Islands Council said it was a "very serious incident", but that engineers worked overnight to put in temporary repairs.
Networks have now been restored at all facilities.
Hayley Green, the council's head of IT and Facilities, said the authority invoked a major emergency plan.
Project Director for NHS Orkney, Ann McCarlie, said: "We can confirm there was damage done to a fibre optic cable during works yesterday.
"This work was being carried out by one of the independent contractors on the project.
"The damage has now been repaired. We can only apologise for any disruption caused."