Hypolimnetic oxygenation, the engineered addition of oxygen gas to the bottom of lakes and reservoirs, can improve water quality by repressing the accumulation of nutrients, metals, and toxic compounds in bottom waters. This study designed and tested an oxygenation system in Lake Bard, California. Hypolimnetic oxygen demand, a key design parameter, was estimated through the combination of sediment–water chamber incubations and numerical analysis of water column dissolved oxygen (DO) profiles. Chamber incubations showed that increased water velocity near the sediment–water interface substantially increased the rate of sediment oxygen uptake, and this observation was incorporated into system sizing. The chamber study also confirmed that maintenance of oxygenated conditions repressed sediment release of phosphate, ammonia, manganese, and sulfide. Phosphorus and manganese release rates were 6–8 mg/m2/d and 2–5 mg/m2/d under anoxic conditions, respectively, but negligible or negative under oxic conditions. The novel hypolimnetic oxygenation system used a waste product, oxygen-rich off-gas from an ozone contactor at a nearby water treatment plant, to sustainably improve source water quality. The system was tested over a 2 week period in June 2004. Oxygen addition averaged 380 kg/d and increased bottom water DO from 1–2 to 5–6 mg/L with a concurrent drop in water column phosphate and iron, and a delay in sediment release of ammonia. Manganese, with its slow oxidation kinetics, remained in bottom waters during the oxygenation test, indicating that the oxygenation system needs to be turned on earlier in the season to better control manganese accumulation in bottom waters.