System and method for diffusing gas bubbles into a pond, lagoon or basin that is used for fish farming or other form of aquaculture. A small amount of water is continuously removed from the bottom of the body of water by one or more counterflow gas lift diffusers. This small amount of water is flowed down underground, has gas bubbles introduced into it, and is then returned to the body of water. The quantity of water removed and treated in this way is a small fraction of the total body of water in the pond, lagoon or basin. The ratio of (1) the total volume of the channels below ground through which the water flows downward, and then back up into the body of water, to (2) the volume of the body of water above ground is at all times less than about 1:100. In the broadest form of the invention, a gas diffuser introduces gas bubbles into the water in the return channel at a level at least about 2 feet below the bottom of the body of water, and no more then about 50 feet below the surface of the body of water being treated. The downflow and return channels and the space joining them at their bottom ends extend no more than about 50 feet below the surface of the water being treated.