The present study was carried out to evaluate the physical and chemical characteristics of water at three sites (the upper and lower lake as well as fish farms) in Wadi El-Raiyan area and their effect on fish production. Concentrations of metals (iron, zinc, manganese, copper, cadmium, and lead) were also determined in some organs of tilapia species to detect the degree of pollution in this area. Water and fish samples were collected monthly during the spring season of the year 2005. Electric conductivity, total dissolved solids, transparency, total hardness, calcium hardness and chloride showed marked variations at the three sites. No oxygen depletions were observed in the three sites and it lies in the safe range for aquatic organisms. In water, the levels of Fe (in fish farms), Cu (in upper lake and fish farms) and Pb (in upper and lower lake) exceeded the maximum world permissible limb. Gills and liver tissues had higher tendency to accumulate metals more than musdes. Metal concentrations in the edible part of the examined fish were in the safety permissible levels for human consumption. Primary productivity (phytoplankton) in water is limited in the habitat of the lakes and growth of fish exhibit well­being and higher condition factor and hepato-somatic index in fish farms and lake I than lake III. The difference in metal concentrations among different sites was insignificant (p>0.05).