Fresh water is perhaps the single most important resource in the park because water quality affects all plants and animals, including humans. The lakes and rivers of Cape Breton Highlands National Park provide homes for many species of aquatic plants, fish, amphibians and insects.

A river or brook and all the little streams, lakes and ponds that drain into it collectively make up a watershed. Sixteen major watersheds drain Cape Breton Highlands National Park. Most of the watersheds in the park begin their journey to the Gulf of St. Lawrence or the Atlantic Ocean as streams draining the extensive bog system on the plateau. Typically, the park's rivers flow along gentle slopes on top of the plateau, then through steep gorges or canyons at the plateau's edge, finally broadening to gentle valleys or short estuary flats at the river's mouth. Many of the rivers follow fault lines which are millions of years old.

Lots of small, acidic lakes formed in depressions left by the glaciers 10,000 years ago dot the highlands, especially on the eastern section of the plateau. Along the coast, a few salty barrier beach ponds occur. These ponds are more able to support life than the highland lakes.

There is a large seasonal variation in water level. Waterfalls plunge in torrents from the highlands in spring and during heavy rain, but may be reduced to trickles in dry periods. Some streams within the park only flow during wet weather and are bone dry at other times of the year.