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Al Jabal Al Akhdar, an arid mountain region in northern Oman, has experienced rapid development over the last decades, resulting in the deterioration of water resources. This paper applies the driving force-pressure-state-impact-response (DPSIR) framework as an integrated environmental assessment tool to illustrate the cause-and-effect relationships for sustainable management of water resources in the area. The research aimed to examine social and ecological aspects of mountain water to explore optimal approaches for sustainable use and management. The water resources are affected by increasing drivers of population growth and socio-economic development, through agriculture, tourism, and urbanization, exerting pressures through overconsumption of water, coupled with the exogenous pressure of climate change. The decreased rainfall and increased water demand have resulted in the degradation of water quantity and quality. The declining state of the water resources and reduced area of cultivation have resulted in considerable losses in agricultural income. The Omani government has adopted some responses, including water development projects, acting to reduce pressures as well as to improve the state of water resources. The DPSIR analysis indicates that trade-offs should be made between economic development and the continued supply of water for the agro-ecological system; choices could be in the prioritization of drivers. A dependence on desalinated water will introduce a reliance on a non-renewable external energy supply and is unlikely to ensure water supply at the multi-century timescale of the social-ecological system. In addition, tourism is predominantly based around the disappearing agro-ecosystems which in turn are dependent on the supply of water. Therefore, efforts should be directed towards improving water-use efficiency through installing modern irrigation technology, water conservation methods, use of greywater and treated wastewater, and rainwater harvesting as well as integrated water resources management, and climate change mitigation and adaptation measures.