In order to implement Integrated Water Resources Management (IWRM) according to good practice, governments and development agencies have promoted the setting-up of Water Users Associations (WUAs) as a broadly applicable model for water management at the local level. WUAs are promoted as key to the rolling out of IWRM principles through a participative process. Using intensive qualitative data, this paper discusses Tanzanian WUAs in light of the Regulatory Framework within which they operate. I argue that although the government’s objectives are to achieve an equitable and sustainable allocation of water resources, the formalisation of water allocation has led to the exclusion of specific water users. This paper focuses on the Great Ruaha River Catchment (GRRC), where water scarcity has led to competition between investors and small-scale water users. The GRRC is an environment in which formal and informal practices overlap, due to legal pluralism and the incremental implementation of water governance frameworks. This study calls for a reassessment of the role of WUAs in Tanzania. There is a clear gap between the theoretical clarity of tasks handed to WUAs (particularly their role in formalising access to water), and the messiness of everyday practice.