A study of the hydrogeology of the southern Frome Embayment has been carried out to assess any possible effects upon groundwater of exploitation of uranium deposits in the area. Water quality in Tertiary palaeonchannel aquifers is unacceptable for all comsumptive uses wherever there are significant uranium concentrations. Lake Frome is an evaporative sink for all the major aquifer systems in the area. The uranium-rich waters of the palaeochannel aquifers move naturally towards the Lake, with much of the uranium precipitated en route in reducing environment traps. Water at the Honeymoon site is estimated to take at least 2,000 years to reach its discharge zone, at a rate of approximately 50 metres per year. In-situ leaching techniques pose no threat either to the aquifer in which the deposit occurs, or to the other aquifer systems in the Frome Embayment, provided that appropriate well construction methods are used, and that there is a net removal of water from the orebody over the period of leaching operations. The technique is being used successfully in Texas, USA to mine from aquifers storing domestic quality groundwater. There, effective control of leaching solutions prevents problems of water quality impairment away from the uranium orebody itself. Well yields in the palaeochannel aquifers may be restricted by inelastic behaviour of the aquifer material under the stress of pumping.