Global change impacts on water availability, water quality and ecosystemservices in Mediterranean river basins of the Iberian Peninsula, as well as theirimpacts on the human society and economy makes it a key issue on the EUagenda. It is likely that Mediterranean countries could suffer ever-more frequentregional water shortages due to the twin problems of climate change and risingdemand. Simulation with hydrological model provides insight into the nature andstructure of connections between water resources and socio-economic andenvironmental changes. The general aim of this study is to provide a better overallunderstanding of water scarcity and results of loss of quality in low flow rivers bydeveloping hydrological model under data-scarce conditions using DHIs’ softwareMIKE BASIN. The simulated effects of a new water stress definition will incorporateboth water quality and water quantity effects into the measurement of waterscarcity. Moreover the proper allocation of water for an industrial, domestic andagricultural sector gets inevitable in the situation of water scarcity otherwise it wouldimpose severe burdens on the economy as well as on the environment. TheCatalan basin of Francolí (NE Spain) is selected for such purpose. The resultsobtained from this model will be helpful in the description and quantification of thebio-physical and socio-economic components of the watershed. Individual futureobjectives will cover the analysis of the river basin with respect to characteristics ofthe water bodies, impact assessments for human activities and economic analysisto achieve good water status for all waters to comply with European waterframework directive for River Basin Management Plan. Watershed characteristicsextracted from these simulated results would be helpful in the future to develop aDSS for water resource management and policy development for low flow riverbasins.