Sri Lanka has been renowned for its hydraulic civilization since the era of the ancient kings. Historically, an advisory committee of experts provided guidance to kings on governing water resources, and communal participation, along with a compulsory labor system known as “Rajakariya,” was used to manage these resources collaboratively. However, the colonial administrations abolished these traditional water governance methods (based on norms, customs, and traditions) and introduced formal legislation and institutions for water governance. Over 50 pieces of legislation and 40 institutions have since been established to manage the country’s water resources. The current water governance framework has, to some extent, adopted a multiscale, polycentric structure. However, many of these laws, being outdated, do not adequately address climate change and variability. Therefore, it is necessary to amend existing legislation to incorporate measures that mitigate the effects of climate change and variability. Furthermore, raising awareness and building capacity regarding the economic value of irrigation and domestic water could serve as a water-saving strategy to help mitigate the impacts of climate change and variability. Ultimately, strong political will and transparent policies are required to improve Sri Lanka’s existing water governance.