In the times of the Holy Temple every burnt offering and peace offering sacrificed on the altar was accompanied by a flour offering and by the pouring of a prescribed amount of wine on the altar. During the seven days of the Festival of Sukkot, water too was poured on the altar as a libation accompanying the daily morning sacrifice.
The water libation is not explicitly mentioned in the Torah but was accepted by our Sages as a halachah l'Moshe mi-Sinai - a law which Moses received at Sinai at the time that the Torah was given. As such, it has the status of a Torah obligation.
All of the observances of Sukkot are performed joyously, for we are commanded to rejoice on this Festival, and the Torah mentions joy with reference to Sukkot more than to any other Festival. No reference to joy is made in the verses that speak about the Festival of Pesach; when speaking about Shavuot, the Torah refers to the concept of joy only once. When speaking about Sukkot, however, the Torah uses the word joy three times:
And you shall rejoice before Hashem your G-d (Leviticus 23:40); And you shall rejoice in your Festival (Deuteronomy 15:14); And you shall be exceedingly joyous (ibid. :15).
Of all the joy on Sukkot, the most intense joy was reserved for the nisuch ha-mayim - the pouring of the water on the altar to accompany the daily morning sacrifice. These three lugin of the "waters of creation" - for the water had not been affected by human intervention or preparation - were the focus of the efforts of the kohanim, Leviyim, and Israelites, of the elders, the pious, and men of good deeds.
A multitude of men, women, and children took part in the celebration which lasted for fifteen and a half consecutive hours, from the time that the daily afternoon sacrifice was offered until the next morning. The celebration was held every day of the Festival, with the exception of Shabbat and the first Festival day, for then the water libation was not accompanied by music and song.