The original Luna Park pictured here was on the North side of Surf Avenue, across from the Atlantic Ocean so I imagine that the water used was from the ocean across the street. What you are looking at is a ride at the amusement park that was very popular and the predecessor of the modern log flume ride seen at various parks these days. The one at Luna Park was called the Shoot The Chutes, and fortunately there is a Youtube available entitled: Coney Island Water Chutes 1896-1903 . You will see the ride operational and the viewing area which I believe is in the great Shorpy photo! Enjoy

Take on Luna Park. Spotted this last night at the New York Botanical Garden Christmas Train Show.

Anyone remember what was the water below this stage? Was it freshwater? Ocean water? Was it a fishpond or a dolphin tank?

Luna Park was only a couple of years old in this photo. It burned down in 1944, though it had been in decline for some time by then. A new Luna Park opened a couple of years ago, not on the same location but nearby, and so far has been quite successful. But it certainly does not have nearly as many bright lights as its predecessor.