1. Combine meat, bread crumbs, egg, and half of garlic in bowl and knead gently until combined. Form mixture into 4 dozen 1-inch meatballs. Heat oil in 12-inch nonstick skillet over medium-high heat until just smoking. Cook meatballs until well browned all over, about 5 minutes. Transfer meatballs to plate.
2. Add remaining garlic to skillet and cook until fragrant, about 30 seconds. Add tomatoes, water, and pasta and bring to boil. Cover, reduce heat to medium-low, and cook, stirring often, until pasta begins to soften, about 7 minutes. Return meatballs to pan and simmer, covered, until meatballs are cooked through and pasta is al dente, about 5 minutes longer. Off heat, stir in basil, and season with salt and pepper to taste. Serve.