This paper presents a new seepage inversion technique to predict the permeability coefficient of the rock mass with developed fracture or fault. With the measured data of flow and water head of boreholes, the permeability coefficient of the rock masses near the boreholes are obtained by inverse calculation on the basis of unsteady seepage tests. Then, a flexible tolerance method is proposed to invert the permeability coefficient of rock masses in different zones of the reservoir area. This comprehensive inversion analysis method is applied in one actual project of the water supply reservoir. The equivalent permeability coefficient of the rock masses in the range of 0 m to 16.0 m below the road surface near the dam axis on the left bank of the mountain is 1.12 × 10 −3 cm/s. The root mean squared error and coefficient of determination of the measured and calculated values are 1.33 × 10 −4 m 3 /s and 0.9976 m 3 /s, respectively. The rock masses in the reservoir site area have high permeability. The groundwater level in the junction area and the mountains on both sides of Shangmo reservoir is low, and the hydraulic gradient is small. The maximum error between the calculated value of the groundwater level and the measured values is −0.41 m, and the relative error is −4.36%. The recommended anti-seepage scheme can effectively solve the problem of large leakage in the reservoir area. The results show that the innovative approach is appropriate for the seepage analysis of the field with the fractured rock masses and more meaningful from an engineering point of view.Water 2020, 12, 734 2 of 17 Currently, the most direct method to determine the permeability coefficient of fractured rock mass is the field measurement method based on statistics and cubic law [10,12]. This method is simple, but it is difficult to obtain representative fracture parameters by outcrop measurement or borehole measurement. The permeability parameters of the aquifer are obtained by an analytical or a semi-analytical method on the basis of the water pressure test [13,14]. The cross-hole tests and isotopic tracer methods are developed to determine the permeability tensor of the rock masses [15][16][17][18]. This permeability tensor can only represent the seepage characteristics of medium near the test area. In recent decades, the inversion methods, such as the Pulse Spectrum method, the Numerical Optimization method, the Artificial Neural Network method (ANN), and the Genetic Algorithm (GA), are widely used in the seepage parameters inversion of fractured rock masses [19][20][21][22]. He et al. (2011) proposed a new approach to determine the equivalent permeability tensor of fractured rock masses by combining the geological method, the packer test method, and ANN [10]. Ren et al. (2016) applied the flexible tolerance inversion method to obtain the seepage parameters of rock masses and faults in the dam foundation of the Maerdang dam [23].Existing research is usually based on the field water pressure test to calculate the permeability parameters of th...