Carbon dioxide is soluble in water. When it dissolves it forms a carbonic acid.
Carbonic acid is what gives fizzy drinks their bubbles. At high pressures, more carbon dioxide dissolves in water, and because this reaction is reversible, when the pressure decreases carbon dioxide is released again. This explains why bubbles appear in a bottle of sparkling water when you unscrew the lid.
Carbon dioxide is denser than air. It sinks, which means that it can smother a fire - starving the fire of oxygen and putting it out. This is why many fire extinguishers contain carbon dioxide gas.