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Western states are beginning to face the economic and social challenges involved in transferring water from agricultural use to municipalities and industries. Because massive water development projects are not likely to be shifted to be undertaken in the future, wise water management entails providing the legal tools to permit water to be shifted to areas of greatest need at the least harm to traditional agricultural users. Coping with these transfers requires, in many instances, changes in existing prior appropriation water laws. For example, efforts to promote more efficient use of water on farmlands should be accompanied by provisions to allow the sale of salvaged water. This article discusses such scenarios for protecting the social and economic interests of rural areas in the context of growing urban water demands. Includes 39 references, figure.