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Surface water is one of the constraining resources for herbivore populations in semi-arid regions. Artificial waterpoints are constructed by wildlife managers to supplement natural water supplies, to support herbivore populations. The aim of this paper is to analyse how a landowner may realize his ecological and economic goals by manipulating waterpoints for the management of an elephant population, a water-dependent species in the presence of water-independent species. We develop a theoretical bio-economic framework to analyse the optimization of wildlife management objectives (in this case revenue generation from both consumptive and non-consumptive use and biodiversity conservation), using waterpoint construction as a control variable. The model provides a bio-economic framework for analysing optimization problems where a control has direct effects on one herbivore species but indirect effects on the other. A landowner may be interested only in maximization of profits either from elephant offtake and/or tourism revenue, ignoring the negative effects that could be brought about by elephants to biodiversity. If the landowner does not take the indirect effects of waterpoints into consideration, then the game reserve management, as the authority entrusted with the sustainable management of the game reserve, might use economic instruments such as subsidies or taxes to the landowners to enforce sound waterpoint management. (c) 2012 Elsevier Ltd. All rights reserved.