The Potrero Stream, the Sauce Lagoon drain, which comunicates its waters with the River Plate, is located at the west of Punta Ballena.
A dam, built in 1945, has achieved the duplication of the area's water volume and the increase of the freatic water tables.
It has an ample bird fauna, with swild species like storks, ducks, herons or swans, among others, and meanders between dunes and abundant vegetation in its way from the lagoon to the sea.
The stream flows in an area of big sand mounds, which is a perfect place for practising sandboarding.
Few meters away from its mouth lays the naturist Beach of Chihuahua, the only beach in Punta del Este where nudism is allowed.