Backwater is a small town on the Great Mobian Prarie. A standard Wild West-style town surrounded by mountains and desert, Backwater possesses strong links to Metropolis Zone thanks to the thriving Apterix meat market, thus enabling the people to import whatever they may need. Notable residents include Chito, the Apterix wranglers Rooster and Boss Krouch, Krouch's son Deputy Krouch and the Sheriff. While Krouch holds the title of Mayor, the Sheriff really maintains the peace.
Knuckles visited Backwater, accused of being the one sabotaging Rooster's herd, and was almost lynched by an angry mob, following misinformation from Krouch. When the Sheriff returned in the nick of time, Deputy Krouch was fired and Knuckles became the new deputy. Together they launched an investigation into who was really trying to kill Rooster, and got results quickly after Knuckles coaxed the information from Chito. When Boss Krouch was brought down, Knuckles departed the Backwater region on one of Rooster's Pterodactyls.