With the most acute water-deficit in the world, the Near East Region challenge for economic and social development is likely to be jeopardized unless drastic measures are taken. The increasing need for water stems from population growth, national economies based primarily on agriculture and harsh climatic conditions and climate change that make rainfed agricultural production volatile. Over the past half century, the increase in food production was mainly due to increase in water availability. Water has contributed more than any other input factor to regional food security. Today, the conventional response to water demand increase through the mobilization of additional resources is either limited or cost-prohibitive. The agriculture sector, by far the largest user with nearly 90% of the total, is faced with the paradox of meeting increased food needs with less water as a result of competition from other sectors that have higher priority and greater value-added to water use. At the same time, agricultural water use has a lower productivity in comparison to its potential as a result of several policy and management drawbacks. Countries of the Region are gradually shifting to water demand management and alternatives to freshwater, through the use of low-quality water resources and desalination of seawater. However, the pace of change is slow and could easily be taken over by increased demand, on one hand, and the options considered are often fragmented and lack integration, on the other. Based ob FAO experience in the Region, the paper first highlights a diagnosis of the main issues facing agricultural water management, focusing on key policy, managerial and technical aspects, and on the lessons learnt from past experience. Then it proposes strategic options that are likely to address these issues, with due consideration to ensuring the highest possible level of food security, resource sustainability and environmental preservation. The foundations of the proposed options stem from the need for countries to chart new irrigation strategies that are marked by departure from previous approaches and which address the underlying causes of the problems rather than the symptoms. They are based on improving productive efficiency of irrigated and rainfed agriculture and removing policy constraints by improving water allocative efficiency. The option of virtual water, as a complement of the proposed reforms, is assessed and the extent and conditions of its applicability are discussed.