Squid Form

Donald Duck is turned into this form when he visits Atlantica. While in this form, he is half-duck on the upper part and half-fish from the waist down.

Kingdom Hearts
In the first game, Donald is able to use magic he's learned from other worlds and fight with his wand.

Kingdom Hearts II
In the second game, Donald's ability to use magic is removed as the design of Atlantica is converted to a world whose story progresses via songs.

Exception
Although Donald turns into a squid when he visits Atlantica in most of the games, there has been one exception in Chain of Memories where he retains his true form.

Trivia
Because Donald is a magician, it's made clear that Donald's squid form is referenced from the sea witch, Ursula, who is an octopus.