The water aeration capsules provide a quick and highly portable system for aerating polluted water. The capsules contain bubbles of air, oxygen, and/or other gas(es) surrounded by a water soluble shell or membrane of a suitable substance, e.g., various salts, sugars, water-soluble polymers, such as polyvinyl alcohol. The capsules are ballasted to make their specific gravity greater than the water they displace. The ballast may comprise any non-toxic metal, sand, clay, or other non-organic material, and/or fish bait or other food for aquatic animals. Magnetically attractive ballast elements may be provided, and a magnetic sheet may be placed on the bottom of a smaller body of water to enhance the settling of the capsules. Various means of dispensing the capsules from various mobile carriers are also disclosed, including dispensing by hand from shore or by a diver, from a small boat or larger ship, and/or from aircraft.