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In general, substances expand when heated, and contract when cooled.
When a substance, including water, is heated. Both the kinetic energy ans potential energy of molecules increase. The increase of kinetic energy leads to a rise in temperature of the substance. The increase of potential energy, which comes from the energy gained during heating by doing work against the intermolecular attractive force between molecules, leads to a larger separation between molecules, hence a macroscopic expansion of the substance.
[Be aware that water has a peculiar behaviour in which it contracts when its temperature increases from zero degree Celsius to 4 degree Celsius].
The evporation of dissolved gases when water is heated does not cause a reduction in volume because the gases are "dissolved" in water. That is to say, the gas molecules are residing in the "gaps" between the water molecules, hence taking up no extra space.