Wilson Inlet is a seasonally closed estuary. The major part of the inlet comprises a broad, shallow, flat-bottomed lagoon that lies behind coastal dunes. The inlet has a surface area of 48 km²; it opens to the Southern Ocean through a sandy flood-tide delta that breaks through the coastal dunes adjacent to a granitic headland. A sand bar isolates the estuary from the ocean for several months a year. Primarily to mitigate against flooding, the bar is artificially opened most years, once the water level reaches about 1 m above mean sea level (MSL). The inlet floor has an average depth of 1.8 m below MSL, and a maximum depth of 4 m below MSL.

Clearing and agricultural land uses have resulted in excessive nutrients entering the estuary, the response has been a proliferation of the seagrass, Ruppia. The Ruppia removes considerable nutrient loads from the estuary and probably protects the estuary from algal blooms. The only effective way to reduce its growth is to reduce catchment nutrient sources.