water spirit; water nymph; naiad
Refers to a mythical spirit or nymph associated with water, such as a naiad in Greek mythology or similar beings in folklore.
It is said that a water spirit lives in that lake.
Compound of 水 (mizu, 'water') + の (no, possessive particle) + 精 (sei, 'spirit'). The exact historical derivation is uncertain; the phrase is conventionally associated with mythical water spirits.