Agricultural intensification in the Northwestern Indo-Gangetic Plain (NWIGP), a critical food bowl supporting millions of people, is leading to groundwater depletion and soil health degradation, primarily driven by conventional cultivation practices, particularly the rice-wheat (RW) cropping system, which comprises over 85% of the IGP. Therefore, this study presents a systematic literature review of input management in the RW system, analyzes district-wise trends, outlines the current status, addresses challenges, and proposes sustainable management options to achieve development goals. Our district-wise analysis estimates potential water savings from 20–60% by transitioning from flood to drip, sprinkler, laser land leveling, or conservation agriculture (CA). Alongside integrating water-saving technologies with CA, crop switching and recharge infrastructure enhancements are needed for groundwater sustainability. Furthermore, non-adherence with recommended fertilizer and pesticide practices, coupled with residue burning, adversely affects soil health and water quality. CA practices have demonstrated substantial benefits, including increased soil permeability (up to 51%), improved organic carbon content (up to 38%), higher nitrifying bacteria populations (up to 73%), enhanced dehydrogenase activities (up to 70%), and increased arbuscular mycorrhizal fungi populations (up to 56%). The detection of multiple fertilizers and pesticides in groundwater underscores the need for legislative measures and the promotion of sustainable farming practices similar to European Union strategies. Lastly, greater emphasis should be placed on fostering shifts in farmers' perceptions toward optimizing input utilization. The policy implications of this study extend beyond the NWIGP region to the entire country, stressing the critical importance of proactive measures to increase environmental sustainability.