Water palace i.e. Jal Mahal is situated in Pink City Jaipur in the Man Sagar Lake.
The palace is in middle of the lake and no one is allowed to enter it. You can just watch it from the road side. One see one story of the palace but in actual, its a 5 storied building. Yes, its 5 storied out of which 4 are submerged in water. The palace was built as a halt point for Royal family when they visit the lake for duck hunting.
The palace is situated en route to Amer Fort / Jaigarh Fort / Nahargarh Fort.
More details regarding this place can be read here.
The Man sagar lake is a great ecosystem and there lives lots of birds here. So its a great place for wild life photographers too.