Information about the current state of water institutional frameworks, water infrastructure and water management policies in Libya enable the identification and evaluation of a range of options for improving water use efficiency in agriculture and the potential role of water pricing in achieving sustainability of water sources. This paper begins with an overview of the agricultural sector. In order to assess the current water situation in Libya, the water infrastructure will be examined through a review of water legislation, its institutional framework and the infrastructure surrounding the various water resources. The national strategy for the management of water resources and the suggested plans to address the inefficient use of water in the Jefara Plain Region (JPR) will be discussed. The last section will be devoted to the Great Man-made River Project (GMRP) and water investment in JPR’s agriculture, and conclude by identifying the problems and obstacles facing the outcomes for these investments.