The group claim that hundreds of barrels of the toxic waste was dumped off the coast in the 1950s.
They are now holding a series of meetings to highlight the situation and plead with the Irish Government to investigate the claims.
North West Donegal Free From Cancer support group, believe the barrels were dumped off Tory Island.
Spokesman Joe Diver, a retired school principal, said the claims must be investigated.
“These rumours have been circulating for many years across Donegal and they need to be looked at.
“Donegal has a huge rate of cancer and is much greater than the rest of the country.
“There is a reason for that and we believe this could be it,” he said.
Mr Diver, 69, who himself survived cancer, says he has heard from local doctors and divers about the exact location of the dumped barrels.
“It would not take a lot to investigate this. The location has been located and one of these barrels could be retrieved to find out exactly what is in them.
“I heard of one diver and he witnessed the barrels himself and saw the warning markings on them. He got out of there as quickly as he could.
“There are huge clusters of cancer in Donegal and this could be the reason for it,” he said.
The cancer support group is to hold a meeting on September 5th in the Ionad Padraig Dore centre in Bunbeg.
Members of the Irish Cancer Society, local cancer sufferers, members of the medical profession and politicians are to attend.
“We want people out there, especially men who find it difficult to talk about cancer, to know that there is a support group here that they can talk to,” added Mr Diver.