The groundwater licensing authorities in the States of South Australia and Victoria recognize that future development of the lands adjacent to the border will depend on the groundwater resource underlying those lands. In most areas there, shallow groundwater is the only reliable source of water; thus any un-regulated large scale withdrawals could compete with existing private and town water supplies, perhaps to a point where continuity of the supply would no longer be assured. Since the effects of large groundwater withdrawals in one State may extend across the border into the other State, there is clearly a need to jointly investigate the extent of the resource, its present level of use, and its future management options to ensure its equitable distribution. The State Border of South Australia and Victoria extends across two sedimentary basins - the Otway Basin in the south and the Murray Basin in the north. Areas of shallow basement rock separate the two basins in both South Australia and Victoria, and these are respectively known as the Padthaway Ridge and the Dundas Plateau. The Tertiary and Quaternary sediments deposited in the two basins vary in lithology but can be correlated from one basin to the other. Groundwater occurs within two broadly defined aquifer systems - a confined aquifer which consists of the lower units of the Tertiary sequence, and an unconfined aquifer which comprises the upper Tertiary and Quaternary sediments. A joint resource management committee, called the South Australia / Victoria State Border Groundwater Sharing Committee, has been formed of representatives of the South Australian Department of Mines and Energy, the South Australian Engineering and Water Supply Department, the Victorian State Rivers and Water Supply Commision, and the Victorian Department of Minerals and Energy. In addition, Professor S.D. Clark of the Faculty of Law, University of Melbourne was invited to join the Committee. The Committee has completed its findings and has formulated a draft Agreement to be recommended to the appropriate Ministers in each State. This Agreement provides for the effective management of the groundwater resource in a Designated Area along the State Border of South Australia and Victoria. The Designated Area has been divided into twenty-two zones to account for the varying hydrogeological conditions known to exist along the border. The draft Agreement was compiled after a critical analysis of the legislative implications of such a management proposal, and following a joint States' assessment of all available groundwater information.