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The two ways to complete this level are:

1. Swim all the way through the level, avoiding any fish hitting you. Enter the green tube at the very end, done! Easy as that!

2. Same procedure as in 1. Instead of entering the green tube though, swim along the path underneath it (this is way easier if you've got a Yoshi, who can first eat up all of the fishes, so you're not getting stressed out by those chasing you). At the end of the path, you will find the key and the lock!

In order to proceed on the Star Road, you will need to choose the second way through the level.