Humanity's ability to progress sustainably is gravely challenged by water pollution and scarcity, so it's critical to create materials or a method that can effectively and precisely detect contaminants, clean up aquatic ecosystems, and use marine resources. A “win–win” tactic for preserving aquatic habitats is the composite of hydrogels with three-dimensional networks and photo-luminescent and hydrophilic carbon dots (CDs). This has shown that the previously suggested strategy is feasible. This chapter reviews the development of carbon dot hydrogel polymers for use in aquatic environments. The initial section throws light on the details of hydrogel preparation techniques, followed by the feasibility analysis of the carbon hydrogel composite. The study also threw light on the synthesis techniques of the carbon dot and carbon dot hydrogel composite. The development of CD hydrogel material research in the field of water treatment and water purification has also been examined in terms of the mechanisms’ potential applications. The readers of this chapter will benefit from the insight into the CD hydrogel development and its utilities for future research.