Food system analysis in arid and semi-arid countries inevitably meets water availability as a major constraining food system driver. Many such countries are net food importers using food subsidy systems, as water resources do not allow national food self-sufficiency. As this leaves countries in a position of dependency on international markets, prices and export bans, it is imperative that every domestic drop of water is used efficiently. In addition, policies can be geared towards ‘water footprints’, where water use efficiency is not just evaluated at the field level but also at the level of trade and import/export. In this paper, Egyptian food systems are described based on production, distribution and consumption statistics, key drivers and food system outcomes, i.e., health, sustainable land and water use, and inclusiveness. This is done for three coarsely defined Egyptian food systems: traditional, transitional and modern. A water footprint analysis then shows that for four MENA countries, differences occur between national green and blue water volumes, and the volumes imported through imported foods. Egypt has by far the largest blue water volume, but on a per capita basis, other countries are even more water limited. Then for Egypt, the approach is applied to the wheat and poultry sectors. They show opportunities but also limitations when it comes to projected increased water and food needs in the future. An intervention strategy is proposed that looks into strategies to get more out of the food system components production, distribution and consumption. On top of that food subsidy policies as well as smart water footprint application may lead to a set of combined policies that may lead to synergies between the three food system outcomes, paving the way to desirable food system transformation pathways.