Minecraft wiki entry for Water, associated text: When a dry sponge comes into contact with a water source or flowing block, it becomes a wet sponge, absorbing all water within 3 to 5 blocks in all directions. Kelp and lily pads within the absorbed water blocks are destroyed and drop as items, and seagrass is destroyed without dropping anything. Mobs that take damage out of water are affected as a side-effect.