This district is so loathed by the rest of the city that they have placed fencing around the whole district, in an attempt to keep the lower classes inside.
Shit Lake is a cesspool, and also the source of drinking water for Hole’s Bottom. When rain falls into Nightlholm, it falls at a slant ad hits the eastern wall of Hole’s Bottom above Shit Lake, and runs like a torrential waterfall. This would be quite beautiful, except all of Hole’s Bottom dumps their sewage and garbage in this lake, and it is also frequently used as a cemetery. So these torrents can cause quite a mess.
The one saving grace of Shit Lake is that it there is an underground water system where the water slowly drains into the river system of the Frostquill Mountains. If the lake completely drains between rainstorms, one can find all manner of bodies, garbage and other oddities.
From time to time, creatures living in the Frostquill River system, specifically those that eat garbage, have been known to make their way into Shit Lake.