Liquids are affected by gravity, and can be splashed by the player, items, or enemies.
There are currently 3 ways to obtain unlimited amount of liquid through duplication, but they require at least one bucket.
The first way is pouring the liquid out of bucket high enough in the air, it will then drop down, but if timed well, you can grab a block of dropping liquid and there still will be left another block falling.
The second way is making two small pits, one on top of the other. You put the lava in the first pit, then destroy the block separating the two pits and getting a block of lava going down. If you time this right, there will be 2 blocks of liquid, and you will have picked up one of them.
The third way is to build and use a duplicator. All you need for a duplicator is a bucket filled with the liquid you want to duplicate and some blocks to build a suitable site to store the liquid in.You can build a simple duplicator by building a 3 block high "tower" and add 2 blocks right or left to the tower's base and add one new block at the rightmost (or leftmost) block. Now your duplicator is done! All you need is something to keep the duplicated liquid in after duplicating it.
The image to the right shows the principle of a very simple duplicator.
Liquids can be quickly and massly duplicated without needing to 'redirect it' assuming you're trying to pour it just into an area. By having a one tile wide block in the air, the player can repeatedly, and quickly clicking the spot above it with a bucket full of liquid. The Liquid will divide, but when you pick up a 'half bucket' full of liquid, it rounds up to a whole bucket.
This can be repeated over and over to quickly fill holes with liquids. One can continue to divide liquid as it falls, making it fill holes faster.Some people make pyramid type structures to clone the liquid quickly. When you place the liquid at the top of the pyramid, it drops down through it. However, when there is only one layer of water falling down and it drops on a block, it would form on the right side, also cloning one on the left. Some experiments show that this is a misconception though, and that water does not clone from this. Because of this, it is an unrecomended method of cloning.
Players may accidentally flood caverns with water while mining or simply wish to remove water from an area. Water can be removed by such areas using sand or a door. First, the player must place a tall pillar of Sand at the bottom of a body of water extending upwards and through the body of water. Next, the player removes the pillar by mining its lowest Sand block, causing the entire pillar to break and reform repeatedly. This, for some reason, causes a large amount of water to be displaced and ultimately "evaporated." The taller the pillar of Sand, the more pronounced the result(This is caused by the sand falling letting water taking its place, then after the falling sand lands, it will reform eradicating the block of water). The same effect can be achieved by putting a door at the bottom of the water, then opening and closing it repeatedly until all of the water is removed.\
However you may pump out the water of the area with an inlet and outlet pump wrench and wire
Note: As of patch 1.1, this no longer seems to work, as blocks in general no longer destroy liquids as they're placed.
A way of removing Water in 1.1 is by using Cursed Torches and Lava. By placing Cursed Torches in some Lava. The Obsidian block that would be generated when the Water comes in contact with the Lava can not be made because the Cursed Torch is in the way.