Investment in the small-scale enhancement of groundwater recharge through check dams and other recharge structures in rural India is on the order of USD 1 billion/year. However, for any catchment, the optimal capacity of check dams is unknown, and the impacts on downstream flows are rarely determined. This paper describes a method that can be applied to plan recharge augmentation in catchments that have at least one monitored check dam. It was applied in the Dharta catchment of the Aravalli Hills in Udaipur district, Rajasthan, India, where four check dams in an ephemeral stream were monitored by farmers over seven years. For the last three years of this study, the hydrology of two of these check dams was affected by 19 new check dams established upstream. A basic hydrologic model, WaterCress, was calibrated on monitored check-dam storages and used to assess the impacts of the new structures on recharge from those downstream. Then, the model was rerun with a range of capacities of upstream check dams to determine the effects of check-dam capacity on (1) the recharge from the downstream check dam, (2) the total recharge from all check dams, and (3) the frequency of spill from the downstream check dam. Using the available economic information, the benefit–cost ratio was calculated for a range of check-dam capacities. This showed a decline in economic efficiency with each new check dam and defined the optimal capacity. Monsoon size was found to be consequential to results, and longer hydrological records yield more reliable results. The study showed that monitoring check dams, rainfall, and groundwater levels is key to deciding whether additional check dams are economically beneficial.