A young girl, who had also been swimming in the reservoir, was pulled out of the water by a passer-by but the man was pronounced dead at the scene.
His body was only found after a search involving a number of boats, police, firefighters and members of the public.
His next of kin has been informed and his family are being offered support by specially trained officers.
One runner I spoke to at Chasewater Country Park this morning called it a “terrible tragedy”. They added: “Its just devastating for it to happen, at such a young age too. My thoughts are with his family and friends.”— Dayna Farrington (@DaynaF_Star) July 1, 2019
Emergency services were called to the country park between Burntwood and Brownhills just before 6pm.
Two air ambulances were sent to the scene along with three land ambulances, police, firefighters and the Hazardous Area Response Team.
The girl who was rescued was initially said by Staffordshire Police to be aged 13, but it is understood she is actually several years younger.
Staffordshire Police has launched an investigation into the man’s death and are asking for any witnesses who were at Chasewater at the time come forward.
A spokesman for the force said: “Police are investigating after the body of a man was recovered from Chasewater Reservoir in Burntwood, Staffordshire.
“Officers were called to the park at around 6pm following reports two people had got into difficulty while in the water.
“A teenage girl made it safely out of the water, but tragically a 21-year-old man died.
“Emergency services including West Midlands Ambulance Service, Staffordshire Fire and Rescue Service and Staffordshire Air Ambulance all attended.
“The identities of the people involved are known to officers and their next of kin are being informed. They will be offered support by specially trained officers.
“The coroner will be informed of the incident, officers continue to investigate the circumstances around what happened and are appealing for anyone with information to contact them.”
West Midlands Ambulance spokesman Murray MacGregor added: “A number of boats and members of the public assisted in the search.
"Firefighters and members of the Hazardous Area Response Team were committed to the water.
“When the 21-year-old man was recovered, ambulance staff tried everything possible, but sadly it was not possible to save him and he was confirmed dead at the scene.
“Thankfully a young girl made it out of the water safely and was unhurt.”
Chasewater is a popular family attraction with walking trails and play areas for children, and the reservoir is often used by boats and water skiers.
Anyone with information is asked to call Staffordshire Police on 101, quoting incident number 654 of June 30.