The Brayford Trust started dredging Brayford Pool to make it suitable for floating moorings.
Through dredging and removing soil from the bottom of the Brayford, the water will be deep enough to install improved docks.
Currently the marina has fixed moorings. However, these do not rise or fall with the water, and pull boats down if the water levels are too high.
The floating moorings on the other hand rise with the water and prevent that from happening.
According to the trust, this is phase three of an 10 year plan to improve the marina and should be completed next month.
The charity which manages the waterways around the pool received a £25,000 grant plus a loan to fund the upgrades earlier this year.
The Brayford Trust has said the work will use around £100,000 of its own funds and the loan from the City of Lincoln Council.
The City Council allocated the funds after plans to build a second floating restaurant were rejected.