The outbreak involved about 100 cases and led to 12 deaths, and was thought to have been linked to poor water quality in Flint city in 2014-15.
According to court documents filed on Tuesday, Lyon "exhibited gross negligence" and that his actions and failure to act "resulted in the death of at least one person".
Flint started using untreated Flint River water to save money in 2014, resulting in lead being leached from pipes into the water supply. Because it had not been treated properly, river water began leaching lead from old lead pipes in residential homes across the city.
Schuette's office also added manslaughter to charges faced by four people: MI department of environment regional supervisor Stephen Busch; state head of drinking water Liane Shekter-Smith; Howard Croft, a former director of public works for Flint; and the emergency manager who ordered the water switch, Darnell Earley.
Nick Lyon has been a strong leader at the Department of Health and Human Services for the past several years and remains completely committed to Flint's recovery.
Schuette said his team had not spoken with Snyder as part of the investigation.
In Michigan, involuntary manslaughter carries a possible prison sentence of up to 15 years. The Michigan Civil Rights Commission issued a report in February blaming "systemic racism" going back decades for the problems that caused the water crisis in Flint.
The state's chief medical officer, Dr. Eden Wells, was also charged Wednesday with obstruction of justice and lying to an investigator.
In response to the charges, Rep. Dan Kildee, who was born and raised in Flint and now represents the district that includes it, said he supports the investigation and its attempt to "hold everyone accountable who did this to Flint".
Legionnaires' disease is a lung infection caused by bacteria that thrive in warm water.
Almost 100,000 residents of the poor, mostly black city, were exposed to high levels of lead, and the ensuing outcry became as much about failed governance and accountability as clean water and concerns about health.
Legal charges were announced Wednesday in a Flint-area courtroom.
Schuette also said the highest priority should be proper funding to conduct the investigation.