Coming from a water abundant city in South China, I did not realise how water presents an immense challenge for China until I had lived in the extremely water scarce capital city, Beijing, for my postgraduate study at Tsinghua Law School. The first spring that I spent in Beijing remarked my first life experience in yellow dusty sandstorms, which later I learnt were mainly caused by aggravating desertification as a result of overexploitation of water resources in China’s second largest inland river basin, the Hei River Basin. In 2005, when I had the opportunity to undertake a PhD in environmental law at Macquarie University in Australia, I was inspired to focus my study on water law and policy reform. Freshwater resources in many countries around the world are increasingly pressured by population growth, economic development, urbanisation, rising standards of living, changing values of the environment, and on top of all these stresses, climate change. While governments confront major issues in sustainable water use, how water governance responds to water scarcity, variability and uncertainty has become a key global policy challenge. Water reforms have been observed globally, delivering mixed outcomes. The roles of government and market in water allocation lie at the centre of the water reform debate, reflecting different values of water as both a public/social and economic good. China’s current water reform aims to explore the application of market-based water allocation mechanisms, for which it is recognised that learning from international experiences is important. Against this backdrop, my PhD project provided a first comprehensive legal examination of water rights arrangements and water rights trading in China by reflecting on experiences from overseas jurisdictions, and particularly Australia and the United States. My PhD thesis forms the foundation of this book.