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Significant challenges have developed for Aurora (Colo.) Water in the face of booming growth and widely variable water source productivity. The utility has implemented highly comprehensive water conservation programs, the urgent need for which became apparent during drought conditions beginning in 2002. At that time, the utility's reservoir storage levels dropped to 26% of capacity, or less than a year's worth of water supply. These programs, along with a 10-year, $1.4 billion capital improvement program and the implementation of multiple-barrier water treatment approaches to protect public health and meet high customer standards, have resulted in growing utility bills. The author examines how Aurora Water is progressively addressing these challenges by providing adequate service levels to current customers while positioning itself to meet future needs. Increasing urban water demands, especially in the southwestern United States, will require reallocation of existing water uses and the construction and operation of new water delivery systems. The information provided here can help today's utility manager negotiate the many challenges of the growing demand for water. Includes 2 references, figures.