Blue Lagoon is a small bay northeast of Padangbai. A steep beach overland, and a bit of current in its waters are some of the natural features of the bay. Divers on tours here take a 5min boat ride from Padangbai. Although boasting a not so spectacular topography compared to its sister sites in eastern Bali, Blue Lagoon does feature great diversity of fish and marine life worth enjoying. These include large Napoleon wrasse, several kinds of reef shark, stonefish, moray and blue ribbon eels, nudibranches, rays, squids and octopuses, giant frogfish and cuttlefish.
While Blue Lagoon is considerably an easy dive (a suitable and frequented site for Open Water courses and popular with snorkelers), experienced divers and photographers also thoroughly enjoy the site. Visibility is 15-20m, there is sometimes a little surge and a mild current but the bay is fairly protected. Blue Lagoon has an extension called Jepun, a treasure trove which features a white sand bottom. An area of artificial reef has also been created on this site, adding to its appeal.