  This paper reports on an XMM-Newton observation of the Seyfert 1 Galaxy Mrk
335 performed as a Target of Opportunity when the source was in an unusually
low flux state. The low level of continuum emission unveiled an underlying
line-rich soft X-ray spectrum, which can be studied with the Reflection Grating
Spectrometer. The emission features have been analysed at high resolution with
unprecedented detail for this source. Line ratios diagnostic from H-like and
He-like ions indicates that the line emission arises in X-ray photoionised
plasma. Extensive simulations have been performed with the CLOUDY
photoionisation code. From the comparison of the expected and observed line
intensities the physical properties of the line emitting material were derived.
Because of the degeneracy in the ionisation parameter, a number of different
solutions in terms of electron density and column density of the gas are
consistent with the spectral diagnostics. This prevents us from determining
uniquely the properties of the plasma; however, the location(s) of the X-ray
photoionised gas can be constrained to be within 0.06 pc (outer boundary). This
limit places the X-ray line emitting gas at the inner edge of the material
where the broad optical lines are produced (Broad Line Region).
