Underwater friction stir welding (UWFSW) is an advancement of conventional friction stir welding, which is performed in air. The need for welding underwater calls for more information to be explored in the welding of different materials. The aim of this research is to investigate the UWFSW of 2 mm titanium sheet joints for their tensile and microstructural properties and compare them with the results of friction stir welding (FSW) performed in air. Also, nondestructive tests, such as radiography and dye penetrant tests, were carried out to identify the occurrence of any weld defects. The rotational speed of the FSW tool and its travelling speed were considered process parameters, while other parameters like the tilt angle of the tool, shape of the tool pin, etc. were kept constant. The results show that the welded joints with higher strengths were achieved at a lower travelling speed of 140 mm/min at a rotational speed of 400 and 500 rpm in FSW and UWFSW, respectively. The mechanical properties such as yield strength, tensile strength, and hardness are improved in UWFSW when compared with conventional FSW due to the proper mixing of the metal and effective cooling due to the water environment. In underwater FSW, the improved YS and TS values are observed, which are 95.9% and 75.1% of the base metal values, respectively, when the tool rotational speed is 400 rpm and the travelling speed is 140 mm/min. However, the elongation % is much lower in both FSW and UWFSW when compared with the base metal. These results are supported by microstructure and nondestructive test outcomes.