The Water Tower is first seen in Season 1 where the kids are painting a marijuana leaf on it. Though Hyde says it looks like the hand giving the finger, and makes Kelso go and fix it, prompting him to fall and break his arm. Red then mentions it when he gets home, saying that some vandalizing dumbasses have painted on the Water Tower. He says, "And it was giving me the finger." The next time it is seen is at the end of the episode where Fez is trying to fix it to make it not look like the hand giving the finger, and saying that his American friends would be proud. However, he falls off backwards while attempting to reach a spot.
The Water Tower is an unsafe place, as when someone even moves, they fall off (Most notably Kelso). In the TV special "That '70s Set Tour With David Trainer," David Trainer says that there have been many ways of falling off the Water Tower, but the most often occured one is the breaking of the railing.
Eric has had a slight discomfort for being on the water tower in the episode "Too Old To Trick-or-Treat, Too Young To Die" as he gets a rush of vertigo after he falls off his roof but catches himself just in time. In the water tower scene, he chases Donna up the ladder of the Water Tower to see what she's up to, but she was only up there for a picnic. Eric then slips after Donna pushes him, and she brings him back up. He then falls off again, this time from the guard rail, and falls into a bunch of trees.
There has only been one incident where someone has fallen off the Water Tower and not live to tell the tale: Charlie Richardson. He gets beer and wants to share it saying "It's finally nice to fell like being a part of something.." Then, leaning on the railing, it breaks and he is left screaming as he falls. Fez, instead of grabbing Charlie, grabs the beer out of his hands. Donna and Kelso both look at him as Donna says "Wow, that was a really awkward landing. I hope he's okay." Then, shortly after his death, The crew comes to the Water Tower, and Donna explains how dangerous it is up there, where Kelso replies, "I guess that this proves that we're totally vincible to these kinds of things." The rail then breaks and Kelso falls and yells up to the gang "Screw that! I'm invincible!" Since his death, the Water Tower has since been named the "Charlie Richardson Memorial Water Tower." The kids never acknowledge that name though (Bret Harrison was actually offered to play the role of Sam Sullivan in "The Loop", therefore, killing off his character). There has also been a scene where Kelso wrote "Michael + Jackie" on the front of the Water Tower, in which Hyde is upset and punches Kelso, making him fall. Then, in a season 8 episode, when Fez brings Jackie up to the Water Tower, the sign now reads "Michael + Fez," Fez, accidentally writing over "Jackie" instead of "Michael" because it was dark. He also says in the finale, that he wanted his first kiss to be "Up here, but I mean, look at it, this place is a dump."
In the same episode Kelso painted "Michael + Jackie" Fez began painting his manhood on the tower. However, Kelso fell off the tower, and Hyde ran down to check on him. Fez was only able to paint a circle before he was arrested.
Every principle male character besides Bob, Red, Leo, and Randy, fall off the Water Tower at some point in the series' run. Kelso has also claimed that he has fallen off the Water Tower in every grade (since 1st of course, when he moved to Point Place), in which Hyde says, "A record that will stand until his son goes to school".