A bucket of water is made by using a bucket on a water source such as a fountain, a sink or a well. A bucket is the only vessel that can be filled from a well.
Like other vessels filled with water, a bucket of water has everyday uses such as transforming clay into soft clay. A bucket of water can also be used to fill a watering can.
A bucket of water is also used in quests such as Plague City (to soften the soil outside Edmond's house) and Clock Tower (to cool the black cog).