Lake ecosystems provide valuable services to society, including the provision of fish, fodder, groundwater recharge, recreation, moderating the local climate, etc. However, the sustained inflow of untreated or partially treated wastewater into lakes has altered the chemical integrity, affecting biological productivity. The current study investigates the water quality of lakes in the Hebbal-Nagavara valley catchment of Bengaluru, Karnataka State, India, and these lakes were chosen based on the existing wastewater treatment facilities. Water quality assessment through the water quality index (WQI) reveals that lakes such as Jakkur, Devasandra, and Thirumenahalli have good water quality, highlighting that the biological processes (using microalgae, macrophytes, and fish) for wastewater treatment represent a promising resource recovery and clean water production approach. The wastewater treatment with the recovery of value-added resources would contribute to the circular economy while minimizing contamination, paving the way for sustainable practices, and leading to a clean environment with socioeconomic prosperity.