The 30 hectare habitat was officially opened on Friday as part of a £115 million project to allow more water to be extracted from the reservoir.

The lagoon was included in the scheme to protect birdlife by providing secure habitats which will be unaffected by fluctuating water levels.

Plans for the lagoon had caused controversy among Egleton residents who feared it would ruin the views towards Hambleton but they have been won over by the Anglian Water scheme.

Rutland Water's reserve manager, Tim Appleton, is also thrilled with the end result and hopes it will be a major boost for the wildlife and tourism in Rutland.

He said: "If the water level recedes when more water is extracted it will leave the western end of the reservoir vulnerable and will reduce the habitat for birds.

"This new lagoon means we have an extra 30 hectares of habitat. We also have fingertip control of the water levels to within less than an inch which means we can create the perfect conditions for the wildlife.

"Birds are already using it but the potential is massive. It will have a major impact on the reserve and tourism."

The new lagoon is the first in a series being created at the reservoir. Rutland MP Alan Duncan officially opened two bird hides at the site on Friday which will open to the public on Monday on World Wetlands Day.

Mr Duncan said: "It's a big investment which means we can have flexible use of the reservoir with the permanent protection of wildfowl habitats. It's an imaginative and sensible scheme which has successfully balanced water supply, nature and the local community."

Anglian Water's chief operating officer, Peter Simpson, added: "We don't want to have a scheme that secures the water supply by sacrificing the habitats here. Biodiversity is a challenge for all of us and this scheme will actually enhance the area when we are not in a drought.

"It was modelled on conditions of the 1954 drought but the chances of that happening again are quite low which means for most of the time the birds have more than 200 acres of extra habitat than the reservoir used to offer."

The project was launched in April 2008 when Sir David Attenborough dug the first turf at the site. More lagoons and dams will be constructed and the work will be finished by March 2010.

The project also includes building a new water treatment work at Wing and laying 42km of water pipes.