A series of ecosystem services (ESs) have a significant impact on water environment. How these ESs can be integrated into water environment management in the lens of coupled human and natural system (CHANS) is still lack exploration. This study proposes an integrating framework that connects the ESs with water environment management to facilitate the watershed sustainable development. We employ the InVEST model to evaluate typical ESs in the Nansihu Lake Basin (largest freshwater lake in Shandong, China), and analyze the spatiotemporal characteristics and trade-off of multiple ESs indicators. By revealing the interaction mechanism and key drivers of ESs and conducting ecological functional zoning, we investigate how ESs can facilitate water environment management in the Nansihu Lake Basin. The results indicated that: (1) The high-value areas of agricultural supply service are mainly distributed in the western plain area of the basin, while high-value areas of water provision, water purification and soil conservation services are in the mountainous and hilly areas in the eastern part of the basin. (2) There is a significant trade-off between crop supply service and water purification services. Crop and livestock supply services have a greater effect on water purification services (TN) than other services. (3) Crop area sown, total power of agricultural machinery and fertilizer application are the main drivers of water purification services (TN). (4) The basin can be divided into three ecological function zones, the agricultural production zone, the ecological regulation zone and the ecological redline zone. These findings imply that water environment management should be integrated with ESs by strengthening intersectoral collaboration, conducting zoning management in watershed planning and applying differentiated control measures in each zone. This includes optimizing the scale and structure of agriculture, and implementing circular economy and clean production practices. This study explored a comprehensive framework of integrating ESs into water environment management to facilitate the sustainable development of watershed.