The U.S. Army Corps of Engineers operates hundreds of multi-purpose reservoirs nationwide, many of which provide water for municipal and industrial purposes. Demands for water from Corps reservoirs are sure to grow, and Congress has ordered the Corps to report on whether water supply should become a primary mission of the agency. The Corps has experienced controversy over water supply decisions, including disputes involving its Missouri River reservoirs and Lake Lanier in Georgia. When the Corps proposed a national Water Supply Rule in 2016, it drew significant opposition, forcing the agency to withdraw the rule and reassess its policies. This article summarizes the Corps' existing authorities and practices on water supply, reviews the issues raised by the proposed rule, and analyzes a legal dispute over control of water within Corps reservoirs. It then examines key policy issues the Corps must address in carrying out its water supply mission, ensuring that state and tribal interests, environmental concerns, public input, and the impacts of climate change are adequately considered.