It was also included on the demo tape that the band sent to Charlie Gillett, which led to their first recording contract.

[1] News and Courier contributor Joel McNally describes how "the band appears out of the fog" to start the song, noting that the effect is "not hokey.

"[4] Hartford Courant critic J. Greg Robertson describes the beginning of the song saying "the soft, haunting electric guitar and cymbals introduction abruptly switches into a forceful and melody and another of [Mark] Knopfler's carefully articulated Reed-like vocals.

"[10] Classic Rock critic Paul Rees rated "Down to the Waterline" to be Dire Straits' 9th greatest song, citing "Mark Knopfler’s ringing guitar and nicotine-laced vocals, his cinematic lyrics and the rhythm section's effortless shuffle.

"[11] Classic Rock History critic Brian Kachejian rated it Dire Straits' 7th best song.