Wal-Mart entered the plea in San Francisco federal court to misdemeanor counts of negligently dumping pollutants from its stores into sanitation drains across the state, spokeswoman Brooke Buchanan said.
As part of the plea, the company will pay the substantial fine that also will cover charges in Missouri.
The plea agreements announced Tuesday end a nearly decade-old investigation involving more than 20 prosecutors and 32 environmental groups.
In 2010, the company agreed to pay $27.6 million to settle similar allegations made by California authorities that led to the overhaul of its hazardous waste compliance program nationwide. The state investigation began eight years ago when a San Diego County health department employee saw a worker pouring bleach down a drain.
In another instance, officials said a Solano County boy was found playing in a mound of fertilizer near a Wal-Mart garden section. The yellow-tinted powder contained ammonium sulfate, a chemical compound that causes irritation to people's skin, eyes and respiratory tract.
"We have fixed the problem," Buchanan said. "We are obviously happy that this is the final resolution."
Court documents show the illegal dumping occurred in 16 California counties between 2003 and 2005. Federal prosecutors said the company didn't train its employees on how to handle and dispose hazardous materials at its stores.
The result, prosecutors say, was that waste was tossed into local trash bins or poured into the local sewer systems. The waste also was improperly taken to one of several product return centers throughout the United Sates without proper safety documentation.
Buchanan said employees are better trained on how clean up, transport and dispose of dangerous products such as fertilizer that are spilled in the store or have their packages damaged.
For instance, workers are armed with scanners that tell them whether a damaged package is considered to contain a hazardous material and are trained on how to handle it, she said.