This paper focuses on the trans-boundary Guadiana River Basin, where the river acts as a natural border between the neighbouring countries of Spain and Portugal. Considered a relatively undisturbed region, it houses high-quality natural landscapes and a richness of biodiversity which are valued and defended by local people as part of their cultural heritage, with present day land use reflecting a mix of coastal and inland tourism, and extensive and intensive agricultural activity. However, Guadiana is also a semi-arid region where human activity and modification of the hydrological regime over previous decades has led to increasing water scarcity and the identification of water shortage as a ‘structural characteristic’ of the system. These considerable environmental problems are likely to be amplified by climate change (the Portuguese study SIAM highlighted the Guadiana River Basin as being especially vulnerable to climate change in terms of water shortage, summer drought and desertification criteria) with important consequences for the availability and distribution of water between different sectors in the future. In light of these anticipated climate risks, and associated environmental problems, this paper will reflect on possible sources of conflict and convergence between agriculture, tourism and water resource management sectors, and evaluate the role of institutions in pursuing a multiple-goal strategy that addresses water scarcity, adapting to climate change, and sustainable rural development. This evaluation will be informed by consideration of the institutional settings conducive to adaptation, as well as a critical appraisal of horizontal, vertical and transborder policy frameworks, and their enabling role in promoting adaptation activity.