The 23-year-old was forced to withdraw from yesterday's 15km cross-country event and tomorrow's individual sprint classic, after recording an increased haemoglobin level of 17.2g a decilitre in a standard pre-competition test.
The accepted safety limit permitted by the Federation Internationale de Ski (FIS) is 17g a decilitre.
The New Zealand team emphasised the athlete had not been sanctioned, but was stood down for health reasons for a mandatory five-day period, and will undergo another test on Friday.
Chef de Mission Peter Wardell said the news was "terribly disappointing for the young athlete".
Koons had been training at altitude and may have been dehydrated at the time of testing.
Two other cross-country skiers at Vancouver have also been stood down due to haemoglobin levels.
A request by the Otago Daily Times to interview Koons was declined yesterday.
Speaking from Vancouver, New Zealand Olympic Committee communications manager Ashley Abbott said Koons was "a bit shocked" about the results and getting support from teammates at the Whistler Olympic Village.
Koons would return to the lower altitude levels of Vancouver today to undergo fluid monitoring by a medical team in an effort to reduce his haemoglobin levels, she said.
If he passed that test, he would be allowed to compete in his two strongest events next week - the 30km pursuit and 50km mass start classic.
Snow Farm managing director Mary Lee, who has known Koons since he was 13, said the news was a real "kick in the teeth" for the athlete.
"The really good thing is that his best two races are his last two," she said.
Koons trained at the Snow Farm last winter.
"He will be taking everything in his stride.
"He is a level-headed guy . . .
"This is just very bad luck."
University of Otago School of Physical Education senior lecturer Nancy Rehrer said several things could cause increased haemoglobin levels, including altitude training, dehydration after training, long-distance travel before an event, and the time of day when tested.
Increased haemoglobin levels caused blood to become more viscous, and increased the chance of suffering a stroke or cardiac arrest when a person slept, she said.
Ben Koons (23)
Born: Dunedin.
Based: Sidney, Maine, United States.
First competed for NZ: 2005
Events: 15km free (yesterday), individual sprint classic (tomorrow), 30km pursuit (Feb 20), 50km mass start classic (Feb 28).