Unagi is the eel in Jolly Roger Bay.
Plunder in the Sunken Ship
When you select star 1, Unagi will be in the sunken ship at the bottom of the level, blocking the entrance to the interior of the ship. To lure him out, Mario must swim back up to the surface, then he may swim back down to enter the ship. If Mario does not go into the ship, Unagi will go back into the ship and Mario must lure him back out again in order to get access to the area again.
Can the Eel Come out to Play?
When you select stars 2-6, Unagi will be hiding in a hole on the side of the main pit of the course. For him to leave, Mario simply needs to get near Unagi. It will have the star on its tail and Mario will need to touch that star to spawn it and make it collectable. Likewise to the first star, Unagi will eventually swim back into the hole after a while.