Pakistan is a drought prone country with devastating consequences for the rural poor particularly in Balochistan, Sindh and South Punjab. During droughts, sometimes lasting several years, ground water and water courses dry and there is acute scarcity of water for irrigation, livestock and domestic use. At the policy level the issue of water scarcity is being addressed through proposed new dams and reservoirs, and construction of canals — a source of major controversy in the country. In the meantime, little or no attention is given to the domestic and small scale user of water. The objective of this study is to provide a context for all those working with local communities and interested in developing water related projects and programmes. The study highlights the immense potential of rain water harvesting, whereby water may be provided to meet local livelihood, irrigation and domestic needs and at the same time reduce pressure on underground water reservoirs.