A lake
Water is a substance that can only be placed by the player when using a bucket. On newly-generated maps, water is common at ocean level in the form of lakes. It also appears in pools, (and in Indev, Infdev, and Alpha, springs) underground and lakes above ground.
In Creative mode, water spreads horizontally and downwards by duplicating itself to empty squares. Water spreads faster than the speed of a walking player, and if left alone covers everything at or below the level the water started at if there is a direct connection. Water is transparent and slows down the player if it is moving through it. Water cannot spread within a five-by-five area of sponge (two blocks on each side and diagonally, with the sponge at its center); this enables it to be cleaned up quickly using sponges.
In Survival mode, water is much deeper and you start to drown after your 15-second air gauge is eliminated. Water is also soft -- falling from any height into water deeper than the height of one block will not hurt you.
In Indev, Infdev, or Alpha mode, water spreads across surfaces in a realistic way but cannot spread on top of another water block. This allows the creation of waterfalls in these modes. The player can pick up water blocks from sources such as an ocean or a lake by use of a bucket. When placed again, the water creates a spring which generates water. When a spring is destroyed, all water created from it is also destroyed. Springs of lava and water also randomly appear in caverns and cliffs. Water will travel a distance of 7 tiles with the counter resetting every time it lands on a lower level while. Falling water does not spread untill it lands on another block.
Though it cannot be placed by the player in single-player Creative or Survival mode, it can be placed in Infdev mode by using a bucket. There was also a water maker block in Indev mode, but has since been removed in newly-generated maps. However, they can still be placed in a map editor such as Omen.
The texture for water was changed in the 0.0.19a client update on June 20, 2009 and is now animated.
Management
Water tends to be harder to deal with on non-creative modes. The easiest solution on Indev is to block the waters entrance and slowly drain the room, although you can prevent the rooms from flooding entirely by using Airlocks.
In Infdev, the easiest solution is to block the waters entrance and slowly drain the room, or if the water is made from a spring the easiest solution is to destroy the spring.
Springs
In Infdev mode, springs can consist of either water or lava. Springs are randomly generated in caverns underground and sometimes above ground. Springs can also be placed by the player by picking up water from the ocean by use of a bucket and then placing the water again. A spring will generate water which cannot flood a room because water cannot spread on the top of another water block. If a spring is removed, all water that was created from it will also be removed, which makes it hard for things to be ruined by springs.
Spring Duplication
The sand bottom in this basin made of ice allows the two ends to create a water spring in the middle.
In Infdev, water springs can be duplicated using any basin of at least three empty spaces, as long as the bottom is not a fluid, such as water or ice. Placing a water spring at two sides of an empty space will create a water spring in the empty space. Also, removing the water from the middle of the basin will allow adjacent water springs to generate a new spring. This does not work with lava.