During the last three decades, the expansion of irrigation using both surface water and groundwater resources has had an important positive impact on Syria’s agricultural production. It is an example of success in achieving food policy objectives, but it has also introduced the challenge of groundwater sustainability. This paper examines the trends in groundwater abstraction for irrigation and the effect of government policies, including input subsidies – such as the diesel fuel subsidy and the crop procurement price support. The fuel subsidy is an important driving force in groundwater depletion and over-abstraction. This analysis examines the interaction between policy signals and the use and allocation of water by farmers. The rapid decline in groundwater resources shows the limitations of this agricultural development strategy and questions its sustainability unless policies change and the rate of abstraction is changed so as not exceed the recharge rate.