There are two different Wells of Eternity. The first Well of Eternity (usually just called the "Well of Eternity" or the "Well") was a lake of scintillating arcane energies formed from the very lifeblood of Azeroth's world-soul. The Well was located on the ancient continent of Kalimdornear the night elven city of Zin-Azshari. The present area where the first Well of Eternity was located became the Maelstrom after the Great Sundering following the War of the Ancients.
The second Well of Eternity was created by Illidan by pouring three vials of water from the original Well into a lake atop Mount Hyjal. It was quickly covered by Nordrassil, the original World Tree.
Well of Eternity is the second 5-player Heroic dungeon added in Patch 4.3, Hour of Twilight. Players go back in time to assist Illidan and Tyrande in battling the Burning Legion. It is rich in pre-Sundering Night Elf lore, as players get to battle Queen Azshara and are transformed into Night Elves for the duration of the instance.
As the bosses drop ilvl 378 loot, this dungeon is more challenging than other heroics and requires ilvl 353 to queue.
From the Blizzard Community site:
"Ten-thousand years in the past, the night elven capital city of Zin-Azshari was a magnificent, sparkling metropolis. Situated on the shores of the Well of Eternity, it was here that the aristocratic Highborne first opened a portal into the Twisting Nether and invited the Burning Legion to invade Azeroth. Under the command of the night elven queen, Azshara, they now pour their energies into the portal, preparing it for the terrifying and glorious entrance of the demon god Sargeras."
The first Well of Eternity was an incandescent and shimmering lake of energy. As the Highborne's obsession with the Well grew, they recklessly drew magic from its depths, throwing it into constant turmoil. Dark storms broke out over its surface, and its waters darkened until they became utterly black. The physical dimensions of the Well were only a trick of the mind. The true Well existed in a thousand dimensions, a thousand places, simultaneously.
The second Well of Eternity glows with an intense blue radiance and remains pure due to the deep roots of Nordrassil.
The original Well of Eternity was formed from a great wound in Azeroth's surface, created when Aman'Thul, the Highfather of the titan Pantheon, ripped the Old God Y'Shaarj from the world's crust and tore it apart. The volatile arcane lifeblood of Azeroth's world-soul rushed to the surface and roiled over the world. It was through this event that the Pantheon realized that the Old Gods had embedded themselves too deep in Azeroth's surface to remove without severely harming the world-soul, and so they instead resolved to imprison the vile entities below the surface of the world.
After the Old Gods and their elemental minions had been defeated and sealed in their prisons, the titans' most powerful servants ¡ª the keepers ¡ª set to work to seal the still-bleeding wound. After having labored day and night to construct magic wards around the wound, the tumultous arcane energies eventually calmed and settled into balance, and the keepers named it the "Well of Eternity". The enormous lake became the true heart of the world's magic and natural power. Drawing its energies from the infinite Great Dark Beyond, the Well acted as a mystical fount, sending its potent energies out across the world to nourish life in all its wondrous forms. The Well accelerated the cycles of growth and rebirth, and before long, it caused sentient beings to evolve from the land's primitive life forms.
Keeper Freya soon set to work to populate the world with life. She created great enclaves of life at the locations where the Well's energies had coalesced ¡ª the areas that would later become known as Un'Goro Crater, Sholazar Basin and the Vale of Eternal Blossoms. She nurtured and molded various life forms and seeded them around the world, the greatest of which were the colossal animal spirits known as the Wild Gods.
Some legends say that from this magical ether the silithid were born.
Among the first and most prolific creatures to emerge from the primordial wilderness were the trolls. In time, a tribe of dark trolls came to settle near the translucent waters of the Well. Over time, the Well's cosmic power affected the tribe, making them wise and immortal. Their skin turned various shades of violet, and they gained a shorter, yet more upright stature. Inspired by titanic words found on titan-forged relics around the Well's periphery, the tribe adopted the name "kaldorei", meaning "children of the stars". They believed that their moon goddess, Elune, slept within the Well's shimmering depths during the daylight hours.
The kaldorei, or "night elves", soon built a wondrous society around the Well. They built their capital, Elun'dris, on the Well's shores and honed their ties with the surrounding woodlands. Soon, however, a small group of elves, later known as the Highborne, became obsessed with unlocking the Well's secrets and began rigorously studying the lake's arcane energies. It is said the Heart of Zin-Azshari was key in the elves' dominance of the Well of Eternity. Later, Sargeras convinced Queen Azshara and her Highborne to create a portal in the Well, leading to the first invasion of the Burning Legion. Following the War of the Ancients, the Well of Eternity was destroyed, and most of Kalimdor with it, leaving only the Maelstrom.
However, Illidan Stormrage had filled seven magical vials with water from the Well of Eternity, and he poured three of the magical vials of water into the lake at the top of Mount Hyjal, creating a new Well. For this insane act, his brother Malfurion and the demigod Cenarius imprisoned him deep beneath Mount Hyjal. The new Well was completely covered by the growth of the World Tree Nordrassil, its malevolent magics lost with the enchantments of the Dragon Aspects.
However, Illidan had not emptied all of his vials in creating the second Well of Eternity (which is why the Aspects were able to enchant the World Tree with no interference). Somehow, the Highborne under the leadership of Dath'Remar Sunstrider had acquired one of the remaining vials and, after founding their new homeland of Quel'Thalas, used it to create the Sunwell. At least two of the last three vials somehow found their way back into Illidan's possession, and he gave one each to his lieutenants, Lady Vashj and Kael'thas Sunstrider. They remained in their possession until the Scale of the Sands recruited adventurers to take them back. These vials are now in the hands ofSoridormi, prime mate of Nozdormu.
Archimonde's goal during the Third War was to rip Nordrassil off and drain the second Well of Eternity.
The Burning Legion was able to destroy most of the Well, leaving behind a crater and puddles, but some of its magical waters yet remain. According toCelestine of the Harvest, as long as at least one drop remains there is still hope. While the Well is harmed, Nordrassil is undamaged.
Speculation about the final vial remnant points to its original host, Illidan Stormrage. It is unknown whether or not he was in possession of it at the time of his death at the former Temple of Karabor, Black Temple.
It is also possible (but not certain) that the final vial was used by Illidan during the War of the Ancients, to defend himself against the Abyssal Doombringer in the Well of Eternity instance. The uncertainty stems from a scene where Malfurion sees Illidan with his hand in the Well after the battle, leading to the possibility that he may have refilled it. In Mists of Pandaria, Kanrethad notes that the Shrine of Lost Soul's power is very similar to that of the Well of Eternity. It is possible that Illidan used the final vial to power the Shrine.
The original Well of Eternity may have had some sort of connection to the Elemental Plane, as the Maelstrom was used by Deathwing to escape from Deepholm. [Sharas'dal, Scepter of Tides], made with water from the Well, is described as being made of "living water" and is capable of controlling creatures of the sea such as sea giants and makrura.
Coveted by demons, warlocks, and many mages, the well is currently the greatest source of arcane magic in the world. While the World Tree's powers have suppressed the corrupting nature of this magic for centuries, if the tree were ever destroyed, this Well would be the source of unfathomable power to an evil creature powerful enough to wield it.