Remove the spout from an empty 5-gallon water container. Add enough water to fill it only 1/4 of the way. Place into the freezer with the spout facing up, this way the frozen section will be at the back of the container.
Once frozen and you are ready to serve your guests, add the watermelon balls, watermelon juice, tequila, lime juice, and simple syrup. Alternatively, this can be made in a pitcher as well. Place the spout back onto the container and your guests are ready to serve themselves.
For a layered margarita: Pour 1/2-ounce blue Curacao over ice. Carefully add the watermelon mixture to create a layered effect.
Garnish with more watermelon balls and lime slices.
Guy's Tip: Keep the watermelon balls in the freezer to help keep the drink even colder.