Excessive demand for water due to growing population, agricultural, and industrial development along with the climate change and depletion of nonrenewable resources, intensifies the need for integrated water resources management and optimal use of water resources as a sustainable source of energy. This paper discusses a complex system of water supply and demand in the Tehran metropolitan area of Tehran, Iran. Water resources in this region include water storage in Lar, Latyan, and Karaj reservoirs, the Tehran aquifer, as well as water discharge in local rivers and in drainage channels (mainly supplied by urban runoff and wastewater). The main priority is operation of water resources in this region to provide over 800 million cubic meters of water per year for domestic consumption to a population of 6.7 million in Tehran. More than 60 percent of this water returns to the Tehran aquifer through traditional absorption wells. Some part of this sewage is drained into local rivers and canals south of Tehran. A good portion of these low quality resources are used for irrigation in the southern part of Tehran, resulting in a significant rise in the water table and considerable environmental problems causing adverse social and sanitation predicaments. A wastewater collection and treatment project is underway and the effects of this project on water recharge of the Tehran aquifer have been considered in this study. In this paper, the results of comprehensive planning for water reuse in the Tehran metropolitan area are discussed. Allocation and reuse of treated effluents after implementation of different phases of the Tehran Wastewater Collection and Treatment Project are also discussed. Collection, transfer, and treatment of local flows south of Tehran and plans to reuse and reallocate them to proposed agricultural lands in southwest Tehran are addressed.. Includes 12 references, tables, figures, maps.