Water shortages in the famed Yellow River basin of north China raise important questions about the People Republic of China's (PRC's) management of scarce water resources. The first chapter of this report argues that the policy context or regionally specific social, political and economic aspects of water management should be considered when developing a policy solution to water shortages. The second chapter explores the myriad natural resource factors that make the Yellow River a difficult waterway to manage and complicate the development of an appropriate policy response to the basin's shortages. The third chapter argues that, although the physical characteristics of the Yellow River basin are partially to blame for the shortages, the most important factor underlying the basin's recent water problems is the failure to coordinate administration of the basin's water users and China's water management agencies. The fourth chapter demonstrate that the two fundamental approaches water experts have used to resolve water scarcity, supply-side and demand-side measures, have and will continue to fall short of remedying the Yellow River management system. The concluding chapter finds that the adoption and implementation of water management reforms in the Yellow River basin is unlikely but not impossible in China's evolving socio-political milieu.