Green’s Dictionary of Slang

a basement or cellar tavern; ‘a rum-shop in a basement’ (Matsell).

1837		Morning Herald (N.Y.) 8 Mar. 2/4: The Diving Bell, a well known haunt of loose characters in Water street. The landlords of this infra terra retreat are Mike & Phil Dolan. [Ibid.] 14 Aug. 2/5: Wm. Pearsall the late keeper of a diving bell and sundry other belles in Water street, was brought up for judgment.
1859		Matsell Vocabulum.
1872		G.P. Burnham Memoirs of the US Secret Service 401: Sailor dance-houses, and underground ‘diving-bells,’ where women and whisky were the marketable wares.