We present the synthesis and a detail investigation of structural and magnetic properties of polycrystalline [VO(HCOO)$_2cdot$(H$_2$O)] by means of x-ray diffraction, magnetic susceptibility, high-field magnetization, heat capacity, and electron spin resonance measurements. It crystallizes in a orthorhombic structure with space group $Pcca$. It features distorted VO$_6$ octahedra connected via HCOO linker (formate anions) forming a two-dimensional square lattice network with a bilayered structure. Analysis of magnetic susceptibility, high field magnetization, and heat capacity data in terms of the frustrated square lattice model unambiguously establish quasi-two-dimensional nature of the compound with nearest neighbour interaction $J_1/k_{rm B} simeq 11.7$~K and next-nearest-neighbour interaction $J_2/k_{rm B} simeq 0.02$~K. It undergoes a Neel antiferromagnetic ordering at $T_{rm N} simeq 1.1$~K. The ratio $theta_{rm CW}/T_{rm N} simeq 10.9$ reflects excellent two-dimensionality of the spin-lattice in the compound. A strong in-plane anisotropy is inferred from the linear increase of $T_{rm N}$ with magnetic field, consistent with the structural data.
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