Harbor Crisis is an event that is available several times a day for one hour.
You may have noticed a large ship off of the harbor dock in Freedom Harbor. During this event, a second ship appears alongside it and NPCs on the two start fighting. You will also see some creatures swimming onto the first ship (they look like blue winged snakes with boobs).
To join, you have to jump off of the dock and swim to the far side of the ship to find an entrance ramp, and go up to the main deck. An NPC Commander on board will give you the option of joining the Harbor Crisis event and give you three options for how to participate. You have 30 minutes to complete these options as frequently as possible. For each time you complete an option, you will get a Navy Medal, and if you get enough of them you will unlock special titles and get bonus XP. Note that every time you complete the requirements of one of the options you have to go back to the NPC Commander to turn in the quest and then choose another option to try; you can't just build up completions of the options and turn them in all at once.
If you choose this option, you need to go back down to the lower deck and grab some cannonballs from some boxes in the cargo hold. Note, each cannonball will take up a standard inventory space so make sure you have some room available. It takes a few seconds to pick up each one. Once you have several balls in your bag, go back to the main deck and use one of the cannons to fire on the enemy ship. Be warned; if one of the snake raiders hits you while you are using a cannon you will be interrupted, and you will first have to fight off the raider before you can use the cannon. It takes several seconds to arm and fire a cannon. You need 2 successful cannon shots to complete this option once, and when you do so any remaining cannonballs in your inventory will not disappear so you could quickly start it again. The cannonballs will disappear once your 30 minute window has expired.
Repair the Hold
For this option you have to go to the lower deck and pick up several pieces of wood from a pile in the cargo hold. Note, like the cannonballs in Return Fire, these pieces of wood will take up standard inventory space. There will be several broken patches on the inner walls of the ship's hull, and clicking on one of these will use up a piece of wood to repair that section of hull. It takes a few seconds to pick up a piece of wood, and a few seconds to repair one section of hull. You will see the snake raiders coming through the cargo hold to go up to the main deck and usually they will ignore you, but not always. If you are struck while repairing a section of hull you will be interrupted, and you will have to fight off the snake raider. It takes 5 repairs to complete this option once, making it the slowest option but also the one least likely to involve combat.
Clear the Deck
This option is the most straightforward of the three, and the one that involves the heaviest combat. You have to go to the main deck and fight the snake raiders. It takes 3 kills to complete this option once, but be advised you may not always get credited with a kill as the human NPC soldiers will also be fighting the raiders, and may get credited with a kill. If you are a Mage this is easily the best option for you, as the Mage AOE spells can damage multiple creatures at once and hopefully take credit for several of them, even ones that end up getting killed by an NPC or another player. Make sure to have a LOT of potions before you do this though, as you will draw a lot of aggro. Be advised, Soul attacks do NOT work on the snake raiders.