The Water Entity was a powerful sentient artifact created by Xagor in Final Fantasy Legend III.
This monster brought to life resembled a gigantic urn atop a floating cloud and continually spewed out water by which to flood the world and via unknown magic spawn monsters that proceeded to infest the world: as time progressed the Water Entity had flooded almost the entire world and made life intolerable for humans - this prompts the heroes of the story to go on a time-traveling adventure to find a means to defeat the Water Entity, along the way they would discover the truth about its origins.
The Water Entity was ultimately destroyed by a dying Sol as his final act - with its destruction the mass flooding of the world was undone and the monsters stopped invading, the Water Entity itself was not a sentient being but rather a mystical construct and was never actually faced in battle during the original game.
In the remake for the DS, Xagor fuses with it in an attempt to defeat the heroes. The Water Entity is also changed from an urn to a monster similar to one of the enemies from the earlier SaGa games.