Deep Water is any portion of ocean at least 16 tiles away from the nearest land. It is necessary to be in deep water to gain in Fishing skill at higher levels.
Certain items, such as a Fabled Fishing Net, require deep water to be used. One clever method to use such things but avoid using a Boat is to utilize the docks of Magincia. The docks there are so large portions of them are past the 16 tile boundary from land, making them deep water territory.