Food system transformation is needed to address the hundreds of millions of people without adequate access to water or food for a healthy life. Nutrition and malnutrition are inextricably linked to water for food, sanitation, hygiene. With 30 percent of the world’s population living in water-stressed environments, the impacts of water scarcity and malnutrition are expected to affect half of the world’s population, and we need a strategy to assist farmers to produce staples for basic food security while, at the same time, increasing the production of high-value and nutrient-dense crops. This report investigates the relationship between water, food security and nutrition using data from Ethiopia on yield, water productivity, and the macro and micronutrient contents of food. Like other countries in Africa and elsewhere, Ethiopia is challenged by erratic rainfall and dry spells. With limited capacity to cope with risks, smallholder farmers concentrate on staple crops, chiefly maize, teff, pulses and oilseeds. Low yields, low water productivity and a lack of diversification of cropping patterns have severe consequences for food security, nutrition and livelihoods.