Creating institutions to manage shared waterways at the basin scale, instead of as a patchwork of fragmented political jurisdictions, has long held attraction for water managers and political scientists. Basin-scale planning, management, and governance, the scholarly consensus runs, can promote cooperative management of shared water resources, facilitate management on an ecological rather than political basis, and better engage a diverse set of stakeholders. Yet in practice, River Basin Management (RBM) has proven difficult to institute and often produced disappointing results, being either too weak to be effective or too technocratic. The case of the Delaware River basin in the United States is a noteworthy exception. RBM in the Delaware basin has taken the form of a capable but inclusive inter-jurisdictional commission that has almost eliminated previously widespread conflict between riparian states; generally improved water quality and ecosystem protection; and empowered civil society. Yet this effectiveness stemmed from a messy political process marked by tension and competition between central, state, and local levels of government. Harnessing this tension to forge a durable, adaptable institutional framework proved to be key to the relative success of RBM in the Delaware basin, providing lessons to inform the management of shared watersheds elsewhere.