For those who know other programs. This technique is similar to assigning negative and positive Boolean values to individual components.

1- Create a scene with an infinite plane of a material other than water.

Top View	Main Camera (MC)View	Rendered MC View

2 - Choose the terrain button with the "?" so as to select a size. Choose a size of about 50 x 50 pixels. If you work with a smaller terrain than the one generated automatically by the program, it is easier to manipulate. If the Terrain Editor appears when you click OK after selecting the terrain, just click OK, again.

3 - Place the terrain on the infinite plane and turn it upside down. If you have trouble with this step, see Mini Tutorial 2 on Placing Terrains and Objects.

4 - The easiest way to initially turn the terrain upside down is to invert it. Double click on the terrain to open the Terrain Editor. Then click on the Invert Command. The bar can be found on the top right of the Terrain Editor. You will have to do minor adjusting after this, but it is a lot easier to turn it over this way than to try to turn it by hand.

5 - Assign a material to it. Highlight it. Go to Objects>Change Object Material.

6 - Highlight the Infinite Plane and then the Terrain. Go to Objects>Make Objects Boolean>Boolean Difference. The first object is the host object or the one that the "hole" will be cut from.

7 - You will, then, notice in the "World Browser" (Information panel on the right a new entry Difference.This entry has a plus (+) in front of it. Expand this plus to work with the separate terrains. The infinite terrain and the lake terrain are now contained under the heading of Difference.

8 - maneuver the angle of the opening of the lake terrain until it is to your liking. Your lake now resides inside your terrain.