The development of multiple-use water systems (MUS) in Nepal has mostly relied on international/non-governmental organizations. Despite the growing interest in MUS within the country, the approach has not yet received space in government policy and programmes, limiting its wider implementation. We seek to understand both the challenges to, and strategies for, scaling-up MUS, especially with regard to how MUS could be incorporated into Nepali institutional and policy processes arising from the adoption of a three-tier (federal, state and local) federal governance system. Our recommendations are informed by a study of MUS in the middle hills of Nepal.