The supply of surface water by century-old infrastructure causes substantial water loss and triggers huge abstractions of groundwater, resulting in low irrigation efficiency. We evaluated the irrigation performance (application and conveyance efficiencies) and water availability (supply-demand) from the field to the Mungi Distributary canal level in Punjab, Pakistan. Between April–September 2019 and 2020, we monitored water delivery in the canal network, soil moisture content in cotton fields, and the canal and groundwater quality. The crops’ actual evapotranspiration was estimated using the AquaCrop model. We found conveyance efficiencies >90% for minor distributaries, 70–89% for watercourses, and ~75% for field ditches per kilometer. Field application efficiency was >90% for drip and ~35% for flood basin, whereas for raised-bed furrow, conventional furrow, and ridge-furrow irrigation methods, it varied between 44% and 83%. The deficits of canal water supply versus demand for cotton fields ranged from 45% to 73%, whereas the Mungi Distributary canal water showed a 68.6% and 19.8% shortfall in the April–September and October–March seasons of 2018/2019, respectively. The study suggests prioritizing improvements to field water application rather than canals with better water quality; additionally, surplus water from the Mungi canal in November and December could be stored for later use.