Although water is often hailed as the lubricant of life, a detailed understanding of its role in many chemical and biological processes still eludes us. In many natural systems, water is confined in an environment where its free movement is restricted and its three-dimensional hydrogen-bonded network is disrupted. Very recently, several groups applied ultrafast laser spectroscopy to study the dynamics of the constrained water molecules. It is observed that the dynamic behavior of the confined water molecules is markedly different from that of the ordinary water molecules. The most striking result is the bimodal response of confined water, with one bulk water-like subpicosecond component and a much slower component in a time scale of hundreds or thousands of picoseconds. This slow second component constitutes 10-30% of the total response and is crucial in the understanding of the role of water in complex chemical and biological processes. The origin of the slow component has been a subject of intense recent debate and has recently been attributed to a dynamic exchange between free and bound water. This interpretation seems to be in accord with the conclusion reached independently by intermolecular solute-water NOE and NMRD studies. In this article, a review of the recent experimental and theoretical work in this area is presented.