The invention of modern water balloon was all accidental. In 1950 an English inventor was trying to create a waterproof sock that would prevent trench foot. He made a latex-coated sock and filled it with water to test for leaks, he noticed a small stream of water gushing from the side and being disheartened by his failure, he angrily threw it on his table. Pleased with the splash, he decided to market it as water balloons for children.
Source: Unbelievable Facts