Unlocking this achievement will also unlock the Merfolk as a playable race.
First, you'll have to find Atlantis. You'll need a ship, and a diving suit to do so. You can buy a ship in Alluris for 4,000 gold and you can also buy a diving suit there for 800 gold. If you start with the Captain background you begin with a free ship.
Once you're in you ship with a diving suit cycle through screens until you find a good diving spot. Dive down and adventure undersea. Eventually you'll lose the suit through random occurence (such as helping a trapper frog), and a merfolk will rescue you. He'll grant you the ability to breathe underwater and bring you back to their city, Atlantis.
Once here you'll have to successfully complete 3 of the different quests offered here to achieve exalted rank. Once you're exalted you can marry the prince, and also buy a house for a different achievement.