Note: This article is about the level that takes place beneath Lake Oblongata. For the article about the lake itself, see Lake Oblongata.
The Lair of the Lungfish is an area underwater composed of the old town Shaky Claim's remains - old buildings and roads.
After Lili is kidnapped by the Hideous Hulking Lungfish of Lake Oblongata, a monster rumored to live in the lake, Raz uses a bathysphere to follow the monster. After the bathysphere sinks underwater it hits a forcefield like bubble and falls through it to an area filled with air. After that Raz explores the area and finds a bell. He rings it and the Lungfish appears. The battle starts (strategy here). Raz uses crates of nails to beat the Lungfish. After some time the Lungfish starts chasing Raz through the remains of Shaky Claim. After chasing Raz through the area the Lungfish stops and starts to fight again. Raz uses the nail crates to beat the Lungfish again. The lungfish chases Raz around a bit more and gets in to the air bubble. The final battle starts. Raz uses the oysters around the area to beat the Lungfish. After he beats the it he uses the Psycho-Portal to get in to its mind and ends up in Lungfishopolis.
- In the final battle area a sign on a building says "Shaky Claim Nail Factory" which explains the nail crates.