Water stress (drought and waterlogging) is drastic abiotic stress to plant growth and development. Melatonin, bioactive plant hormone, has been widely tested in drought situations in diverse plant species, while a few studies on the role of melatonin in waterlogging stress conditions have been published. In the current review, we analyze the bio-stimulatory functions of melatonin on plants under both drought and waterlogging stress. Melatonin controls the levels of reactive oxygen and nitrogen species and positively changes the molecular defense to improve plant tolerance against drought and waterlogging stress. Moreover, the crosstalk of melatonin and other phytohormones is a key element on plant survival under drought stress, while this relationship needs further investigation under waterlogging stress. In this review, we draw the complete story of water stress on both sides: drought and waterlogging through discussing the previous critical studies under both conditions. Moreover, we suggest several research directions, especially for waterlogging, which remains a big vague piece of melatonin and water stress puzzle.