In recent years, Iran has faced an escalating water crisis, emerging as one of the country's most pressing challenges in the realm of public policy. This study seeks to identify the underlying causes of the crisis and analyze its consequences, while also exploring strategic solutions. Employing a data-driven theorizing method based on the grounded theory approach of Strauss and Corbin, the research involved 23 semi-structured interviews with subject-matter experts. The collected data were analyzed through systematic coding. Findings indicate that the core driver of the crisis is unsustainable water resource management, a condition largely shaped by historical policy decisions and insufficient oversight, particularly regarding groundwater extraction. In addition, anthropogenic factors—such as disproportionate industrial and agricultural development, climate change, and limited application of modern water-efficient technologies—have intensified the crisis. The study also presents strategic recommendations to improve water governance and policy planning, offering actionable insights for achieving long-term sustainability of Iran's water resources. Ultimately, the findings suggest that the root causes of Iran's water crisis lie not in natural phenomena, but in ineffective policy frameworks and mismanagement.