The water would be heated, and perhaps boil or vaporize with sufficient heat transfer. The water would have to be pressurized, which is what high pressure water jets do for cutter. They require sapphire nozzles because metals would corrode and erode.
In a steam engine, most of the water is boiled by heat from a fire. Water vapor is a combustion product, but is very small compared to the mass of water that is boiled. Steam locomotive exhausted steam in an open cycle, whereas many electrical plants using the Rankine (steam) cycle have a closed loop.
At high pressure, or rather high velocities, water erodes materials.