Emergency services attended the scene of an incident on State Highway 8 near Cromwell at about 1.45pm yesterday afternoon.
A vehicle parked on the side of Lake Dunstan has rolled forward into the water and become submerged, with five occupants still inside, including two children.
Four adults and a ten year old child were able to escape from the vehicle, however attempts made by the occupants to unbuckle a three year old child were unsuccessful.
A witness to the incident entered the water and dove down to the vehicle, however he was also not able to retrieve the young child.
Local Fire Service volunteers entered the water with dive equipment and the young child was recovered from the vehicle.
CPR was attempted once he could be brought to shore, but he died at the scene.
He is Aarush Macwan aged three of Auckland.
The other occupants of the vehicle were transported to the Cromwell Medical Centre where they received treatment and were discharged.
A thirty two year old male relative of the child has been charged with careless driving causing death and will appear in the Alexandra District Court on Wednesday the 27th of April 2011.
A number of Victim Support volunteers were called to the Cromwell Station and assisted in supporting the occupants of the vehicle.