This paper examines physical and perceptual properties of water sounds generated by small to medium sized water features that have applications for road traffic noise masking. A large variety of water sounds were produced in the laboratory by varying design parameters. Analysis showed that estimations can be made on how these parameters affect sound pressure levels, frequency content, and psychoacoustic properties. Comparisons with road traffic noise showed that there is a mismatch between the frequency responses of traffic noise and water sounds, with the exception of waterfalls with high flow rates, which can generate large low frequency levels comparable to traffic noise. Perceptual assessments were carried out in the context of peacefulness and relaxation, where both water sounds and noise from dense road traffic were audible. Results showed that water sounds should be similar or not less than 3 dB below the road traffic noise level (confirming previous research), and that stream sounds tend to be preferred to fountain sounds, which are in turn preferred to waterfall sounds. Analysis made on groups of sounds also indicated that low sharpness and large temporal variations were preferred on average, although no acoustical or psychoacoustical parameter correlated well with the individual sound preferences.