The watchdog agency said the crisis has gone beyond the ability of the Tokyo Electric Power Company to handle, after neglect allowed the problem to fester.
Shinji Kinjo said the contaminated groundwater had risen above the barrier installed to contain it, likely leaking into the ocean.
"TEPCO's sense of crisis is weak," Kinjo said. "This is why you can't just leave it up to TEPCO alone to grapple with the ongoing disaster."
"Right now, we have an emergency," Kinjo said.
The plant was badly damaged in the March 2011 earthquake and tsunami. The Japanese government allowed TEPCO to dump thousands of tons of contaminated water into the sea as an emergency measure.
The company has apologized after spikes in radiation measurements in the seawater near Fukushima forced it to admit it had failed to prevent contaminated water from leaking out.
But if the contaminated groundwater rises to the surface -- something Kinjo said could happen within three weeks, "it would flow extremely fast."