The Water Balloon is a weapon that, when fired, launches a water balloon straight forward. Balloons will bounce off the environment once before bursting, and will also burst on contact with other racers. Water balloons always come in packs of three. If not encountered by the player or bursted upon impact, they will eventually self-destruct.
Water balloons lack homing capability, but can disorient racers much more than a firework. Try firing them on straightways, near jumps, or at corners to cause some havoc.