Water and land grabbing is often an indication of growing control by an elite group over natural resources for agricultural production, marginalising their previous users. It may drive and exacerbate social, economic and political disparities and so increase the potential for conflict. In Southern Morocco’s Souss valley, the overuse of water resources is causing aquifer levels to sink and agricultural land to be abandoned. At the same time, irrigated agriculture is still expanding, often permitting the lucrative growing of citrus fruits. This export-oriented agriculture mostly benefits the economic elite, increasing their political influence. Small farmers, on the other hand, face growing threats to their livelihoods. A public-private partnership (PPP) project reallocating water through a 90 km pipeline from a mountain region to plantations in the valley has been implemented to enhance water supply and save dying citrus plantations. However, it is accentuating disparities between farmers. We trace the dynamics of marginalisation linked to this PPP and use emerging water conflicts as a lens to analyse the appropriation of water resources and the underlying political and economic relationships and strategies. On the basis of the case study, we show that water conflicts are as much struggles over political influence as over the resource itself and, consequently, that the related phenomenon of 'water grabbing' is not only driven by economic interests but also determined by a political agenda of regime stability and economic control. However, we also point to the opportunities presented by recent social and political changes in Morocco, including the influence of the 'Arab Spring', and argue that such processes as increasing transparency, decentralisation and the empowerment of local civil society support the re-appropriation of water, livelihoods and power. We conclude by examining the limits of this PPP model, which has been internationally praised by financial institutions, and calling for a careful evaluation of its ecological and social impacts before such experience is replicated elsewhere.