Although mismanagement of groundwater resources has resulted in their destruction over centuries, climate change is speeding up this process more than ever. On the one hand, urgent action by government bodies is needed to address the challenge. On the other hand, a vast body of literature proves that bottom-up collective action, although requiring a longer time period, is a better solution to manage such resources. This research aims to address this dilemma. The groundwater resource in Ardabil plain in Iran, which has long been managed solely through government intervention, has been chosen as a case study to explore the opportunities and limitations of managing a critically endangered area from a common pool resource perspective. Our study suggests that managing Ardabil groundwater resources should be conducted on two scales. The bottom-up institutional agreements should take place at village scale while the government should stay in charge of the overall organization at plain scale.