Improvement of water productivity (WP) in the agricultural sector is one of the necessities of sustainable use of water resources, crop production sustainability, water demand reduction, and fulfillment of food security for the increasing population of Iran. In this research, through facilitated brain storming meetings and harvest of the ideas of the experts and resource persons participated from the water and agricultural sectors of the country, the software and managerial issues and challenges (socio-economic and policy– institution) associated with the improvement of WP in Iran were systematically identified and developed in the form of problem trees. Based on the results, the main source of the above issues could be identified in the five following categories namely as: 1) Insufficient accordance of the country’ s policies with the WP, 2) lack of proper implemented plans for the integrated management of water supply and demand, 3) lack of proper measures, incentives, and or motivation for investing on the development and of the water resources and O&M of the water infrastructures, 4) low levels of efficiencies in the planning, study, design, and implementation of the country’ s water resources and associated infrastructures, and 5) insufficient activities on training and capacity building programs require for the improving of WP. The suggested strategies are: 1) More accordance of the country’ s policies with the WP concept, 2) more stability and consistency in the developed policies and the plans, 3) making more incentives, motivations, and measures for real water savings, 4) A shift from centralized provincial management of water to the basin-wide management, 5) establishment and or completion of data bank, 6) demand management through inverse solutions, i. e., virtual water management, 7) revisions in and or more accordance of the higher education system with the water management and WP subjects, 8) empowerment of stakeholders and participatory management, 9) Upgrade of education and making required capacities in the Stakeholders, 10) making revisions and re-orientation of water resources researches in the line of water saving, and 11) mainstreaming of improvement in WP in other disciplines of agricultural sector (livestock, fisheries, and etc. ).