There is an emerging problem of water scarcity associated with the water-energy nexus that has become even more complicated, and more acute, in many rural, irrigation-dependent farming and ranching communities in arid and semi-arid regions of the western U.S. and Canada. The combination of environmental laws, growing populations, increasing demand and higher costs for energy, globalized competition for agricultural commodities, and the spectre of climate change creates a wicked problem that challenges the efficacy of traditional water rights and water delivery systems, as well as the long-term sustainability of the resource-oriented communities and ecosystems involved. How might this wicked problem be resolved such that we simultaneously have more water for streams (ecological health) and growing populations, fewer fish passage obstructions, improved economic viability for working rural landscapes, more carbon free energy, adequate water quality, and improved reliability in water delivery for all water rights holders, while respecting and keeping existing water rights intact? This research analyzes the case of the Whychus Creek watershed in Oregon (USA), where an inclusive set of stakeholders collaboratively transformed the traditional irrigation system into an integrated hydro-irrigation-restoration system more fully responsive to the many different facets of the wicked problem associated with the water-energy nexus.