I had some good stuff on me and ran out of water. Is there a loot bag I can go pick up or is it lost forever?
You lose everything you were carrying when you die and they are forever lost, this includes the items you picked up and the ones you started with.
Permanent items (Upgrades) will not be lost, like: Waterskin, Rucksack and other items that increase water reserves, carrying capacity and increase health.
Also you will be kicked back to the village.
As you explore you will discover areas of the map. Going back to the village successfully makes these areas remain visible for the next travels, however, if you die, the last areas will be covered up again.
Credits to fbueckert