This thesis is the first empirical study of an emerging concept, vector-agriwater. Vector-agriwater is common pool water resources that are allocated to urban centres, instead of irrigation, in order to increase the overall agricultural output of a system. In semi-arid areas of sub-Saharan Africa, urban centres are connected to a large hinterland of rainfed farming communities and farmers depend on urban services for their agricultural production. Vector-agriwater enables urban services to flourish with a safe, reliable water supply and supports a diverse urban economy, potentially facilitating farmers’ access to services and urban markets. This study reports findings from comparative case study research in Ethiopia. Ethiopia is experiencing rapid urban growth and irrigation expansion resulting in fierce competition for common pool water resources. There is a favourable policy environment for increasing irrigation for food security and poverty alleviation since Ethiopia’s macroeconomic policies are based on agricultural development-led industrialisation. This thesis challenges a dominant focus on irrigation by revealing that, under certain conditions, meeting urban water demands may support small increases in the productivity of rainfed agriculture which can produce more agricultural output overall than if those water resources are allocated to irrigation. It draws on evidence collected during a period of fieldwork from 2014-15 with mixed methods: surveys, focus group discussions and semi-structured interviews. Conceptually, this thesis bridges existing theories of rural development and water resources management to make an original contribution to improve our understanding of the most prudent use of water resources in semi-arid environments for increasing agricultural output. Empirically, it finds that: 1) rainfed farming households are highly underutilising urban services for different reasons, 2) an urban water supply is a limiting factor for the urban economy, 3) urban water supplies play a role in sustaining rural-urban linkages and 4) allocating water resources to urban centres instead of irrigation is politically viable but requires strong, enforceable institutions and integration of water governance actors