Penstock Lagoon is a small water storage located in the Central Highlands. Nestled in native woodlands, with grassy shorelines, the lagoon is protected from the prevailing westerly winds. The maximum depth is 1.8 metres but much of the lagoon is around 1 metre deep. The shallow clear water promotes good aquatic plant growth and insect life. During early morning and in the evening brown trout can be found tailing around the shallow grassy edges. Wet fly fishing from a boat is popular but the highlight is the mayfly (Penstock brown) hatches that occur between November and February bringing the fish to the surface with boisterous rises.

The lagoon is restricted to fly fishing only.  There is no natural recruitment so wild adult brown trout are transferred from the spawning runs at other highland lakes each winter. There is also some stocking with rainbow trout. The average size of fish in the lagoon is between 1-2kg but much larger fish are caught.

Penstock is a venue for the World Fly Fishing Championship 2019. Check out the video below.