Concrete hardens as a result of the chemical reaction between cement and water (known as hydration, this produces heat and is called the heat of hydration). For every pound (or kilogram or any unit of weight) of cement, about 0.42 pounds (or 0.42 kg or corresponding unit) of water is needed to fully complete hydration reactions.
However, a mix with a ratio of 0.42 may not mix thoroughly, and may not flow well enough to be placed. More water is therefore used than is technically necessary to react with cement. Water-cement ratios of 0.45 to 0.60 are more typically used. For higher-strength concrete, lower ratios are used, along with a plasticizer to increase flowability.
Too much water will result in segregation of the sand and aggregate components from the cement paste. Also, water that is not consumed by the hydration reaction may leave concrete as it hardens, resulting in microscopic pores (bleeding) that will reduce final strength of concrete. A mix with too much water will experience more shrinkage as excess water leaves, resulting in internal cracks and visible fractures (particularly around inside corners), which again will reduce the final strength.