One of the foremost attractions of the Dal Lake, apart from shikaras and boathouses, is the Floating Vegetable Market, which happens to be the only one in the country and second only to the rowing shops along the backwaters of Vietnam's Mekong Delta. The vegetable-sellers have their own island in the Dal Lake and start selling from four in the morning and close within the next two hours.

The market got international attention when a Japanese photographer clicked its photos and published them in a tourist guide. Around 1.25 acre of land along the Dal Lake is used for vegetable cultivation and it takes around an hour to reach here, so one needs to rise early and book a shikara the night before. The wetland of Dal Lake produces a variety of vegetables including cucumbers, tomatoes, brinjals, water chestnuts, lotus stems and kohlrabi.