Pretty unlikely that is a natural pond, and it could certainly use a face lift! With that said, it has a lot of potential to clean it up and make a beautiful spot.

Personally I would first find out what is living in it, and if it is worth saving. If nothing worth saving, I would drain it, and hire out someone to excavate, make the sides less steep, and clean up the site. Then lay some top soil down in the barren areas, seed it up with your choice of sustainable vegetation, and enjoy!