Water scarcity exacerbated by growing demand in different sectors has created environmental, social, and economic challenges in the Urmia Lake Basin, Iran. Tackling this problem requires an integrated approach considering the basin as an interconnected system where a change in one sector affects others. Here, a System Dynamics Model is developed to simulate the water-energy-food nexus in the Urmia Lake Basin as a holistic multi-sectoral system and to assess the impacts of proposed lake restoration measures, especially looking for trade-offs. Besides considering climate change impacts, the effect of different sets of measures including increasing irrigation efficiency, increasing return flows, inter-basin water transfers, crop land retirement, and reviving a portion of the lake on the natural resources and socio-economic state of the basin are analysed. Results show that Urmia Lake level is sensitive to climate change scenarios. A holistic restoration approach could be effective in increasing the lake level to the proposed ecological level by 2040. However, in doing so, electricity demand in the agricultural sector could grow significantly. It is shown that a 20% retirement of irrigated wheat lands to curb water demand, if coupled with a 20% increase in yield on 80% and 50% of irrigated and rain-fed fields respectively, will not reduce wheat production in the basin. The effectiveness of water demand management measures is highly dependent on continuous monitoring and enforcement, particularly in restricting growth in agricultural water consumption. This study considered all nexus sectors in a holistic way to assess the total impact of proposed measures which on paper look positive, but may have unexpected consequences such as increasing energy demand for electric pumps. In dialogue with Urmia Lake restoration practitioners, this work can feed in to inform effective decisions for the restoration of Urmia Lake.