Anthropogenic climate change is creating numerous challenges for rapidly urbanising countries. Foremost among these challenges is securing potable water for the urban population, while at times, mitigating flood risks. This article presents research on urban water issues in the rapidly growing city of Dhulikhel in Nepal within a global purview of climate change processes and impacts on urban water. The vulnerabilities to climate change are extremely high in Himalayan cities. New theoretical approaches are required to accurately define problems, causation and potential solutions. Our research has experimented with and developed the concept of Critical Urban Water Zones (CUWZs), which integrates vertical and horizontal elements of the physical environment with social, political and cultural considerations over time. CUWZ enables the identification of critical water management issues in local areas and provides a foundation for future urban water management policy and practices that are climate adaptive and equitable.