This is a bit of history about the water balloon from wikipedia:

The inventor of the rubber balloon, (the most common balloon) was Michael Faraday in 1824, with various gasses and liquids. The first commercially marketed water balloon was produced by Edgar Ellington in 1950, while trying to invent a waterproof sock to solve the disease known as trench foot.^[1] The design for the sock was a latex coating over a normal cotton sock. When the invention was up to his standards for testing he tried wearing the sock but then quickly found out the elasticity of the latex made it difficult to put on. After ripping several pairs of his waterproof sock he finally managed to successfully put the sock on by carefully heating the sock with an indirect heat source. He was thrilled with his success and had taken off the sock and filled it with water and tied the top to make sure that he had not accidentally ripped the sock unknowingly. When he did this he saw a small stream of water spurt out of the balloon. Disheartened by his failure, he threw the balloon down and let it break over his table in his study. The satisfaction that he produced when doing so made him come up with the idea of a water balloon to which he would market to children. At first he marketed it as a water grenade, because his introductory idea was to aid soldiers in war, but later changed the name to water balloons to make the activity more child friendly.^{[citation needed]}=

This is a pretty funny experiment and of course when the pressure exerted from the water exceeds the strength of the balloon this is what happens 😉