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This article analyzes the effects of water supply variations on micro-level agricultural irrigation under institutional water constraints and projects the irrigation percentage and farm income under future climate scenarios. We use a highly detailed data sample of irrigation status, water rights, water supply, and agricultural land use from Idaho’s Eastern Snake River Plain Aquifer area. Results indicate that a 1-unit increase in irrigation percentage leads to similar to US$12 ha(-1) increase in crop revenue. Compared to crop revenue, micro-level irrigation percentage is more prone to changes under long-term water stress. The modest changes in climate, water supply, and crop prices can lead to the change in irrigation percentage by -86 to 53 units and correspondingly in average crop revenue by -52 to 48 % in Idaho’s most productive region. Seasonal water supply variations only have limited impact on the productivity of the irrigated agricultural sector as a whole. We postulate that average irrigation percentage and farm income will, in effect, increase under Idaho’s institutional water governance in the long run, when junior farmers stop irrigated agriculture practices due to persistent water shortage.