This is due to the phenomenon of Total internal reflection which occur when the light is travelling through a dense material ( in this case water ) hits the boundary of less dense material ( air ) and if the critical angle is small enough then the light undergoes reflection (inside water) and laser beam seems to be trapped inside waterfall.
In the same way, The Fibre optic cables also work on the principle of Total internal reflection.
Source : https://www.sciencealert.com/13-science-facts-never-learned-high-school-2017
