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What to do when water heater is leaking?
First you need to have someone come out and check it to see where it is leaking from. But I could bet you donuts to dollars you will have to replace it. If you are a home owner, your home owners insurance should cover the costs of damages done by the leak depending on where it is located in the house. If you live in an apartment then the management has to change it out at no cost to you.
I just went through this just three months ago and believe me, it is not cheap, but the best place to go is Home Depot. Not only do they give you a warrenty for heater itself, they add and additional life time guarantee as long as you own your home. My total cost was around $600 dollars. But the first thing you need to do is have a professional look at it.