- The physical interconnection of ground and surface waters is rarely acknowledged in inter-state and international agreements over surface water. This is especially true in the Rio Grande/Rio Bravo basin, where groundwater pumping is at the heart of several disputes and legal cases related to compliance with intergovernmental water agreements. This research considers the Upper and Middle Rio Grande basin to explore how groundwater use and management interact with interstate (i.e. intranational within the US) and international relations (US-Mexico). We consider three distinct geographic regions to address the following questions: how have intergovernmental surface water agreements affected local groundwater management and policies? And, how does groundwater management at local scale influence intergovernmental relations over water? We combine documentary data and interview data collected through extensive fieldwork during 2016 and 2017. The analysis reveals the emergence of both state-driven and community-based groundwater initiatives aimed at reconciling needs and obligations stemming from different geographical and institutional levels. The analysis uncovers strong institutional interplay across water management levels and suggests that compliance with intergovernmental agreements in federal and international contexts both affects and is affected by local groundwater management. Moreover, we observed that while local water managers are sometimes prevented from solving problems locally due to interstate rules, opportunities for innovation in local groundwater governance can also be triggered by compliance obligations at other levels.