The double IRA bomb attack took place in August 1979, one of the worst atrocities of the Troubles.
PSNI Superintendent Jane Humphries said the report of criminal damage was made at 1:35pm on Sunday and that wreaths and crosses had been damaged.
She believed the attack took place sometime between 4pm on Saturday and 12.30pm on Sunday.
“Our enquiries into this incident, which is being treated as a hate crime, are continuing and we would urge anyone who witnessed what happened, or who knows anything about this to get in touch with police,” she said. “We would also ask anyone who may have captured dashcam or helmet cam footage on the Warrenpoint dual carriageway to call police on 101, quoting reference number CCS 1099 of 02/06/18.”
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Information can also be provided anonymously to independent charity Crimestoppers on 0800 555 111.
Newry UUP councillor David Taylor condemned the latest attack.
“Yet again an incident has occurred which has resulted in the desecration of poppy wreaths and crosses placed at Narrow Water near Warrenpoint,” he said.
“This attack is another despicable act just like the many others which have occurred at the site of the memorial dedicated to the 18 soldiers murdered by the IRA on 27 August 1979.
“I say to those who perpetrate these sickening acts, enough is enough! The families of the 18 murdered soldiers already endure enough heartache through losing their loved ones in such tragic circumstances without having their pain further compounded when incidents of this nature occur.
“I appeal for all political representatives and community leaders to do everything in their power to ensure that these attacks stop once and for all.”
SDLP South Down MLA Sinead Bradley said this was the sixth time the site has been vandalised since 2017.
“This is another sickening attack on memorial wreaths at Narrow Water and I condemn it in the strongest terms,” she said.
“The thugs who set out to destroy memorial wreaths and inflict further pain on those seeking to remember their dead lack any human decency.
“I would appeal to anyone with information to come forward to police.”
The attack was the highest death toll against the army in a single day during the Troubles.
The first bomb was planted in a hay lorry at the side of the road.
When it exploded it killed six soldiers who were travelling past in a four-tonne lorry.
As other soldiers arrived on the scene to help, a second bomb hidden behind a nearby wall also exploded, killing a further 12 more soldiers.
The attack took place only hours after the Queen’s cousin, Lord Mountbatten, was killed in an IRA bomb attack on his fishing boat at Mullaghmore in County Sligo.