The Danjera Camping Ground also known as Yalwal Camping Ground will be closed for an indefinite period because of the lack of rainfall.
The camping ground will close from Monday, December 16 and will only reopen when there has been a significant amount of rain.
Acting director of Shoalhaven Water Robert Horner said when the dam level is low there are safety concerns for campers.
"When Danjera dam is drawn down four meters it introduces public safety issues with exposure of pipes and things like that. So it becomes quite dangerous," Mr Horner said.
The camping ground has already been closed periodically because of the fire danger.
"The camping ground is closed under normal circumstances when there is a very high fire danger in the area," he said.
"That's mainly because there's one road in one road out and very susceptible to bushfire."