Laughing water had a number of curative and helpful benefits. Tasting a drop of the liquid completely reversed any exhaustion an individual felt. A single mouthful cleansed the individual from diseases, parasites, reversed effects of insanity and cure blindness.
Laughing water served as a substitute for holy water in rituals of the Eldathyn faith, albeit at double the required volume. It was harmful to the undead and even negated the effects of the spell Tasha's hideous laughter, when splashed on an affected individual.