<p>One of the most common governance mechanisms in irrigation systems is the establishment of Water User Associations (WUAs), which allocate access rights and responsibilities among a formally recognized group of irrigators (i.e., insiders). This study adopts a sequential mixed-methods approach to examine how outsiders’ extraction –by irrigators or other users who are not members of the WUA– affects insiders’ compliance with allocation rules. Using a logit model and data from 64 WUAs managing surface irrigation water in central Chile, we find that WUAs exposed to outsiders’ extraction exhibit significantly lower levels of compliance with internal allocation rules. Our paper contributes empirically, conceptually, and methodologically by introducing novel organization-level data, extending the concept of conditional cooperation driven by outsiders’ poaching to the context of Water User Associations, and integrating econometric analysis with qualitative evidence. Semi-structured interviews with three WUA presidents drawn from the quantitative sample provide insight into the mechanisms underlying illegal water use. The interviews indicate that weak enforcement –arising from the absence of effective sanctions, permissive executive boards, or limited state support– erodes internal governance and undermines compliance. Our findings suggest that illegal water use by both outsiders and insiders disrupts established social contracts and fosters conditional cooperation within WUAs. This underscores the importance of clearly defined property rights and robust enforcement mechanisms, consistent with Ostrom’s design principles for common-pool resource governance. Addressing illegal irrigation water use by both outsiders and insiders is therefore critical to sustaining cooperation and safeguarding the long-term viability of WUAs.</p>