Urban water management under conditions of water scarcity and climate change is not merely a technical issue; it simultaneously encompasses economic, social, and environmental dimensions. In this framework, limited access to safe drinking water, improper resource management, recurrent droughts, destructive human activities, and inequalities in water distribution and consumption are among the most critical factors intensifying the crisis at the local level. Reforming water governance by relying on transparent, accountable, and participatory mechanisms is a prerequisite for reducing excessive consumption and increasing allocation efficiency, requiring cross-sectoral cooperation among government institutions, local bodies, and citizens. On the other hand, the economic valuation of water by determining real prices based on extraction, treatment, transfer, and conservation costs can modify consumption behaviors, provide necessary financial resources for infrastructure development, and reduce resource pollution through punitive-incentive instruments. Contingent valuation findings indicate that governance and public trust are the primary determinants of willingness to pay for water quality improvement, while the deep gap between the public and authorities limits the acceptance of economic water policies. Consequently, strengthening the role of non-governmental organizations in monitoring, public awareness, and participatory management, establishing local water management councils, providing transparent quarterly reports on water quality, and developing smart consumption-metering technologies are proposed as key strategies for enhancing water sustainability and equity.