This large gravel pit was excavated between 1935 and 1970. The Sussex Wildlife Trust bought the 88 hectares in 1992 and since then the nature reserve has been making more shallow margins and new islands. There is a birdwatching hide overlooking the water near the castle and a viewpoint overlooking the reedbeds at the northern end.
A major wetland creation project, in summer 2003, was part of a national project co-ordinated by the RSPB, called Reedbeds for Bitterns. This is creating an area of reed that will be large enough for Bitterns to stay and breed, AND more wetland habitat for other rare species such as Water Vole, Medicinal Leech and Lesser Water Plantain. The second phase of this project was completed in summer 2006 and was funded by English Nature through Defra's Aggregates Levy Sustainability Fund. Castle Water is now home to Bittern, Marsh Harrier, Bearded Tit, Water Rail and Cettis Warbler all year round.