You have made an important observation in optics, which is the science of light, and an important field of physics.

Light can travel through transparent (see-through) materials like glass, plastic or water, but it does not pass through them unchanged. The transparent material has a different density than the air it is traveling in, causing the light to change direction inside of it. This is called refraction: its why observations made through water are distorted or offset and it is also how lenses work.

In a lens, light is refracted different ways depending on the curvature of the surface and the material's properties. Under the right conditions, these materials can bend light rays to make things look bigger than they are (they can magnify). Many optical devices (binoculars, eye glasses, telescopes, and microscopes) use the same basic ideas of bending light to fool your eye and brain so it appears to come from larger or closer objects. The magnification depends on the distances between the lens and the image and the lens and the object.

A convex lens curves outward in the middle and can focus light rays to magnify an object. Water in a curved container or water droplets (both highly curved and convex) can thus be great magnifiers.

This is in contrast to a concave lens, which curves inward in the middle and spreads light rays out. Looking through this kind of lens can help us focus our eyes on something far away.

The reason that objects sometimes appear magnified when under water has to do with the curvature of the water surface.For example, when you put a small drop of water on top of an object (you can try this on a postage stamp, or a word on the cover of a magazine), the object looks bigger. The curved surface, unlike a flat surface, bends the light as it comes out from the water, and causes this magnification effect. This effect is very similar to how a microscope or magnifying glass works, except instead of a curved drop of water, the lens if made of a curved piece of glass. The more curved the water droplet (or glass lens) is, the higher the magnification. To show that a flat surface of water does not act to magnify objects, just fill a clear cup with a small amount of water and place it over a newspaperyou will see that the size of the words is the same compared to without the water.