For agrarian states located in semi-arid regions and depending on irrigation for agriculture the expansion of residential areas means not only a loss of the suitable agricultural lands, but also a competition over water resources. The challenge exists on how to allocate and distribute the water for multiple uses and users. We present a case study on the urbanizing rural areas of Ferghana district in Uzbekistan. Here the rising competition for water among commercial farmers and household water users is also associated with a gender dimension and calls for a change of the water governance structure. While traditionally Water User Associations (WUAs) are set up to govern and manage water resources for farmers, the urban expansion into agricultural areas implies that WUAs must integrate the concerns of non-farmers and multiple water uses within peri-urban communities.