Nepal’s agriculture faces emerging soil and water issues and challenges in agricultural production, necessitating urgent attention. These challenges include soil compaction, pollution (including microplastics), cropland abandonment, and the depletion of spring and groundwater resources. Additionally, persistent issues such as soil nutrient and carbon depletion, acidity, erosion, and imbalanced fertilizer and improper water management continue to impact agricultural productivity. The presence of rugged terrains, diverse geography, and the compounding effects of population growth and climate change exacerbate these challenges. Transformative strategies and interventions are imperative to effectively manage soil- and water-related issues and challenges to increase crop, soil, and water productivity amidst climate change and population growth. Existing institutions, including research, extension, and education bodies under various ministries, can play a pivotal role in addressing soil and water issues. However, their roles, responsibilities, and resource allocation are not effective in tackling the present and emerging issues related to soil and water management and in making the country self-sufficient in agriculture production. The recent federalization of Nepal’s government structure has further empowered local governments to engage in local-level soil and water management. However, it is essential to acknowledge that institutions focused on researching and disseminating soil and water-related technologies have faced setbacks. Current legislation and policies related to soil and water management fall short in adequately addressing emerging issues. In this chapter, we explore how Nepal can navigate existing and emerging soil and water management-related issues and challenges within the context of geographic diversity, climate change, and population pressures. We propose transformative pathways related to improved institutional quality (e.g., human resources development and improved governance) and policy reforms that align with the present legislative and federal frameworks. By adopting innovative approaches and fostering collaboration across sectors, Nepal can safeguard its soil and water resources, increase agricultural production, achieve food security for growing populations, and realize sustainable and transformative agricultural development.