The NDWI index was proposed by McFeeters in 1996.

Its primary use

today is to detect and monitor slight changes in water content of the
water bodies. Taking advantage of the NIR (near-infrared) and GREEN
(visible green) spectral bands, the NDWI is capable of enhancing the
water bodies in a satellite image.
The downside of the index is that it is sensitive to built structures, which
can lead to overestimation of water bodies.

For Landsat 8 data:

NDWI = (Band 3 – Band 5)/(Band 3 + Band 5)

Where Band 3 corresponds to Green light and Band 5 is near infrared

region of light.