You have asked about one of my favorite creatures - the sponge! I also like Sponge Bob Squarepants, but of course, he has some real advantages over real sponges in terms of ocean survival! Plus, he has a starfish for a friend (my second favorite animal).
The sponge (there are ~5000 different species) belongs in the phylum "Porifera" (the "pore bearers") and if you have ever used a real sponge, you were basically using the skeleton of one of the species from warm, tropical waters. Sponges are very useful to man - in addition to providing a nice cleaning tool, they have served as the source of many biomedical compounds (anti cancer drugs and anti-microbial). Scientists at UCSB are studying the "spicules" - small rods in the sponge that help give it form - for the unique biomaterial properties that they exhibit. Sponges also are just remarkably beautiful.
Sponges live at every depth in both marine and fresh water environments, and under a variety of conditions. They are "sessile" animals (they don't move around) and they live by pumping large volumes of water through their bodies and filtering out tiny organisms and organic particles as food. They get eaten by starfish, some fishes, nudibranchs, and snails, but many sponges avoid being eaten by having scratchy textures and strong chemicals that don't taste very good.
The sponge reproduces sexually (usually) and most species are hermaphrodites - that means that one animal can make both sperm and egg. The sperm are vented out into the sea water and then brought into the animal to fertilize the eggs. The embryos develop inside the adult to a free-swimming larval stage which is released into the sea water, swims around a while, and then settles on a surface and metamorphoses into an adult. The adults keep growing and growing and growing... some species can reach up to 2 meters in diameter!
Sponges are cool though, because they can also reproduce asexually -- if a part of a sponge breaks off, it can continue to grow (but it is genetically identical to the sponge that it broke off from). Most sponges can also form a kind of "capsule structure" (called a gemmule) that allows the sponge to survive long periods of environmental stress or dry conditions - it basically stores nutrients and provides protection for the sponge cells, which stay in "stasis." Then, when conditions are right, the sponge "emerges" from this capsule and starts growing again. Scientists are interested in how sponges regenerate and go into this stasis because of the biomedical implications. Can you think of some ways how regeneration and stasis would be useful to humans? If you search on line (try Google images or Google scholar) you can find some terrific pictures of sponges. They truly are fascinating and beautiful creatures!